ekerhed & sandvall (2010)(2013) slutgiltiga...

Corporate social responsibility – A case study of three Swedish MNC`s in the

emerging Peruvian market

Author(s): Moa Ekerhed, International business Mariana Sandvall, International business

Tutor: Examinator

Susanne Sandberg Petter Boye

Subject: International business

Level and semester: Bachelor thesis, spring 2010

Corporate social responsibility Linnaeus University Moa Ekerhed & Mariana Sandvall

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Acknowledgements The concept of corporate social responsibility has been very interesting to study and we have gained a lot of knowledge concerning the subject. First, we would like to give our sincere thanks to SIDA that enabled us the opportunity to conduct this minor field study in Peru. We would like to thank our supervisor Susanne Sandberg that has supported and guided us during this whole process. Further we want to thank all of our interview persons for the valuable information and time they gave us before, during and after the interviews; Gina Muñiz -‐ Securitas Stefan. E Sandberg – General Council Lorena -‐ Perez Helden – SKF Ignacio Francisco Menéndez Larrea – Atlas Copco Raul Alta Torre Del Aquila – Nordic Chamber of Commerce

Moa Ekerhed Mariana Sandvall -‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐ -‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐ 2010-‐05-‐28 2010-‐05-‐28


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Abstract Date 2010-‐05-‐28 Level: Bachelor thesis in international business 15 hp Authors: Moa Ekerhed Mariana Sandvall Birth year 1986 Birth year 1988 Supervisor: Susanne Sandberg Commissioned by: SIDA Project: Minor field study

Title: Corporate social responsibility – A case study of three Swedish MNC`s in the emerging Peruvian market Purpose: The purpose with this thesis is to gain understanding of how Swedish multinational corporations work with CSR in an emerging market. We will study what kind of CSR they are implementing on the market and how their surrounding environment influences them. From a theoretical perspective we will analyze the impact of the stakeholders and how they gain legitimacy, further how this is taken into practice.

Method: The research is built upon a qualitative method where the primary data was studied from conducting several interviews concerning corporate social responsibility and sustainability practices. The research was conducted with an abductive research approach. The three companies that were examined were SKF, Atlas Copco and Securitas. We also performed interviews with the Nordic Chamber of Commerce and the Swedish General Council in Peru. Conclusions: Our conclusion is that the CSR concept is very in time and companies are nowadays raising more awareness of CSR issues and implementing more CSR and sustainability practices. The stakeholders are becoming more important than ever and in order to gain legitimacy companies have to work hand in hand with their stakeholders and surrounding environment to be able to achieve a sustainable future. CSR is vital for the sustainability and plays a significant role for the future of corporation’s existence and progress. Keywords: Corporate social responsibility, sustainability, stakeholder, legitimacy, the Peruvian market and cooperation.


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Table of contents

................................................................................................................................................ 0 1. Introduction................................................................................................................... 5 1.1 Background....................................................................................................................... 5 1.1 1 CSR in Latin America and Peru .................................................................................. 6 1.1.2 General description of Peru ...................................................................................... 7 1.1.3 Project Niño’s socialmente responsable ................................................................... 8

1.2 Problem discussion........................................................................................................... 9 1.3 Questions........................................................................................................................ 10 1.4 Purpose........................................................................................................................... 10 1.5 Limitations ...................................................................................................................... 10 1.6 SIDA (Swedish International Development Agency) ...................................................... 11

2. Methodology ................................................................................................................12 2.1 Choice of subject ............................................................................................................ 12 2.2 Research strategy ........................................................................................................... 12 2.2.1 Case study ............................................................................................................... 13

2.3 Research approach ......................................................................................................... 13 2.4 Data gathering ................................................................................................................ 14 2.4.1 Gathering of primary data....................................................................................... 15 2.4.2 Gathering of secondary data................................................................................... 15

2.5 Procedure ....................................................................................................................... 16 2.6 Research quality ............................................................................................................. 17 2.6.1 Validity..................................................................................................................... 17 2.6.2 Reliability ................................................................................................................. 18

2.7 Criticism of the sources .................................................................................................. 18 3. Theoretical framework..................................................................................................20 3.1 Background CSR:............................................................................................................. 20 3.1.2 The CSR movement in Peru..................................................................................... 21.......................................................................................................................................... 22

3.2 Internal and External CSR ............................................................................................... 22 3.2.1 Internal CSR ............................................................................................................. 22 3.2.2 External CSR............................................................................................................. 23 3.2.3 Corporate Communication...................................................................................... 24 3.3Stakeholder Theory ..................................................................................................... 24 3.3.1 Primary and secondary stakeholder ....................................................................... 26

3.4 Legitimacy theory ........................................................................................................... 26 3.4.1 Carroll’s pyramid ..................................................................................................... 27 3.4.2 Triple bottom Line ................................................................................................... 28

3.5 Codes of conduct............................................................................................................ 29 3.6 CSR criticism ................................................................................................................... 29

4. Empirical findings..........................................................................................................31 4.1 CSR History and background .......................................................................................... 32 4.2 CSR practice of the firms ................................................................................................ 33 4.3 External stakeholder influence ...................................................................................... 35


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4.4 Legitimacy....................................................................................................................... 38 4.4.1 How much corporate social responsibility should a company take?.......................... 39 4.5 Future ............................................................................................................................. 40

5. Analysis.........................................................................................................................42 5.1 The CSR concept ............................................................................................................. 42 5.2 CSR practice of the firms ................................................................................................ 42 -‐ How do Swedish MNC´s work with corporate social responsibility in an emerging market? ............................................................................................................................ 42

5.3 External stakeholder influence ...................................................................................... 44 How do external stakeholders in the emerging market influence the CSR involvement of the Swedish MNC´s?............................................................................................................. 44 5.4 Legitimacy....................................................................................................................... 46

6. Conclusion ....................................................................................................................48 6.1 CSR.................................................................................................................................. 48 6.2 Stakeholders ................................................................................................................... 49 6.3 Legitimacy....................................................................................................................... 49

6.4 Recommendations ......................................................................................................51 Reference list....................................................................................................................52 Attachment........................................................................................................................... 56


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1. Introduction In this chapter we will begin to introduce the corporate social responsibility (CSR) concept to further continue with our problem discussion and our formulation of research questions.

1.1 Background Corporate Social Responsibility is an issue that has been acknowledged as a competitive business strategy, firstly implemented in multinational corporations in industrialized countries. According to Rowe (2005) a business strategy poses to business’s collective self-‐interest and argues that CSR has been one of global business’s preferred strategies for quelling popular discontent with corporate power. In recent years CSR practices has become more common in emerging markets but has not yet been implemented in a broader sense. Today’s business world is getting more integrated and sees advantages in putting more effort in the development of social, environmental and work related issues. CSR means that businesses return a favor to society and can earn a higher degree of commitment and trust among the society. CSR defined by the World Business Council for sustainable development follows:

"Corporate Social Responsibility is the continuing commitment by 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” (Sims, 2003).

A positive company image and reputation makes the company become more competitive. Surveys have showed that a positive view of a company increases the market shares and also the company’s legitimacy towards society, stakeholders and their employees (Kotler & Lee, 2005). Stakeholders are having a greater importance in the companies’ business strategies and issues like corporate communication and stakeholder dialogue is being acknowledged and discussed. Having a dialogue with the stakeholders is important because in today’s world having cooperation’s and alliances with reliable partners is becoming very useful considering companies potential on a foreign market (Pedersen 2006). Legitimacy is a part of the CSR concept and a definition follows:

Organizations continually seek to ensure that they operate within the bounce and norm of their respective societies, that is, they attempt to assure that their activities are perceived by outside parties as being legitimate (Deegan 2002).

For companies it is becoming more crucial to gain legitimacy as the development of CSR is evolving further (Deegan 2002). CSR can be both internal and external for a company. Internal means more focus on the company’s internal issues such as their employees and the development of human capital, while the external CSR is more concentrating on human


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rights and to be good corporate citizens, for example having different projects concerning social incentives (Baumgartner & Ebner 2010).

A new era of internationalization and globalization has taken place, and according to Aguero (2004) no business is any longer only local in the sense of production, trade and technology because internationalization means further connection with companies throughout the world. An aspect of internationalization is increased contact with firms globally. Adopting the features of international business has also led to adopt social responsibility as a matter of international legitimacy (Augero 2004). According to the Swedish Trade Council emerging markets are the future and in 20 years’ time they will be as large as the traditional markets. Common for the emerging markets of the world is that they grow rapidly. A company that is entering an emerging market needs to be well prepared, chose the right cooperation partners and most importantly think in a long-‐term view (www.swedishtrade.se). During the last decades emerging markets have become very attractive for foreign direct investments and many multinational corporations (MNC´s) have expanded their global strategies to take advantage of business opportunities in these countries. On the contrary the emerging markets can also be huge challenges due to uncertainties such as political, economic and social issues (www.ccsenet.org).

1.1 1 CSR in Latin America and Peru

The concept of the socially responsible firm is becoming larger in both developed and developing parts of the world. The Latin American CSR movement first appeared in the 60s in Brazil and since the 80s it has become more significant and companies and organizations begun to plan seminars and events to enlighten CSR. CSR in Latin America is a growing phenomenon and the subject is getting more enlightened. Private businesses that implement CSR codes are in the center of a system of pressures that involves many actors. This include domestic actors such as the firm, the state, local business and industry, local independent non-‐governmental organizations (NGOs), academic institutions and organized labour; as well as foreign actors such as the foreign firms to which the local firm is linked (through sales, contracts, inputs, or ownership), foreign governments, private foundations from developed countries, international NGOs, and multilateral organizations (Haslam 2004). According to Ans (2010) the influence of international actors weights heavy on the CSR in Latin America. In 1996 the organization “Peru 2021”, founded in 1994, started to engage in the promotion of corporate social responsibility and involve companies in the CSR work (Pareja Sedano 2009).

“Peru 2021” stated that CSR is "a business vision that incorporates respect for ethical values, people, communities and the environment. CSR is seen by leadership-‐companies as more than a set of specific practices or occasional initiatives motivated by marketing, public relations or other business benefits. It is seen as a broad set of policies, practices and programs that are integrated throughout business operations and supports the decision making process and is awarded by the administration” (www.peru2021.org).

Important is also the role of social pressures, business leader’s views and management concepts in the promotion of CSR. The origins of CSR in Latin America consists of three interrelated factors that may be deposited as a basis for the emergence of CSR in these


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countries; social mobilization and pressure from below, changing views among business leaders and development in management theory and practice (Aguero 2004). Today as business´ expands globally a new context and era of internationalization and globalization has made that no business can be seen only as local. Firms that export to or are based in developing countries, influence the expansion of CSR promotion to Latin America (Aguera 2004).

In our case the head offices of Atlas Copco, Securitas and SKF are located in Sweden where the base for the CSR policies and standards are set, with only local adjustments depending on which country of operation. In Peru there is low private sector participation and low government involvement concerning CSR (Haslam 2004). Peru is a country that is still in a development phase concerning foreign direct investments. There are 27 active Swedish companies in Peru most of them multinational corporations (swedenabroad.se). Most commonly is that larger companies have policies concerning CSR, such as the International labour organization (ILO) and the Global Compact; both United Nations based standards for sustainability and social responsibility. Companies have to implement global standards and policies to be able to be competitive on the international area; moreover the presence of Swedish companies can contribute to that development by implementing their standards and policies. Peru is far behind in their CSR work compared to other South American countries. That depends for example on Peru’s last period of unstable political and economic situations, of course more important and prioritized issues.

1.1.2 General description of Peru

Peru has 27 million inhabitants, and the country is divided into three different regions; the jungle, the mountains and the coast. Lima, the capital of Peru is located on the coast Peru is a relatively instable country with social and ethical tensions, an extensive poverty and a very small middle class. President Alán García Perez represents APRA – Alianza Popular Revolucionaria Peruana, a social democratic party that has the length of office to 2011. In a try to achieve macroeconomic balance between the rich big cities and the poor countryside, a new law releases the Peruvian highlands from taxes, which Garcia means should be seen as a Free trade agreement. President Alán García Perez represents APRA -‐ Alianza Popular Revolucionaria Peruana, a social democratic party that have the length of office to 2011. In a try to achieve macroeconomic balance between the rich big cities and the poor countryside, a new law releases the Peruvian highlands from taxes, which Garcia means should be seen as a Free trade agreement. The largest contribution to the Peruvian economy is the mining, but also export gods like wool and fishmeal. The manufacturing industry is not well developed, but has global competitive advantage because of comparatively low production costs (swedenabroad.com). Here are infinite possibilities in Peru and that the Peruvian economy is stable and in order, even though the Swedish willingness to invest for the moment is pretty low. Peru has the latest years exploded in foreign direct investments but Sweden is no longer number one of the Nordic countries; Norway and Finland are far ahead of us in investing. The poverty is a threat for the democracy even though the poverty decreases and the middle class increases. South America is a relatively small market for the Swedish trade, approximately 2-‐3% because the major focuses are in Asia and the United States. Traditionally Sweden and Peru


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have had a positive trade balance. The values of the exported goods have always been higher than the imported goods, but in 2009 a difference was noticed in the statistics for the first time ever. Now, the import is of larger value then the export, and both are heavily increasing. Peru has a lot to deal with considering the social and institutional instabilities.

One example is that in the southern parts of Peru the mining companies have been facing a lot of problems with the local communities, with protest actions, strikes and riots (interview Sandberg, 2010-‐05-‐05). This has happened because the local and regional government has not dealt with the problems and has not treated the locals in a correct way. Companies has to be prepared for that change is coming and more and more people are becoming aware of social problems in society and wants to have a change (interview Raul 2010-‐04-‐19).

1.1.3 Project Niño’s socialmente responsable

One of Securitas external projects that are connected to the Securitas association is Niño’s Socialmente Responsable. It is a project where Securitas together with the community and the local church cooperate in order to give these children and their families a better life. They started this project in 2005 and today around 90 children and their families are a part of the project. We got the opportunity to see in practice how these Swedish multinational corporations work with CSR, both internally and externally.

We went to Surco, a district in Lima where it is very common that poor groups of people without any place to live move up in the hills to build their homes there. This is against government regulations, but because the people have nowhere else to live they create small communities there without electricity nor water. These communities are called invasions in Peru and we visited one called Diente de Oro, situated in Villa Libertad. The children that are a part of the project live here. The local people told us about their situation, how they only receive water every fifteen days. Securitas has a small facility in Villa Libertad where they give the children breakfast every morning for a good start of the day. This is a part of their project of decreasing the malnutrition of the children. In Villa Libertad they are starting to build up a church to use as a wawa wasi (a kind of kinder garden) and also a room for the mothers where they can knit and sew, to further sell their handcrafts to earn some money of their own. Once a week, every Saturday, the children of the Securitas project comes to Securitas to have a class in values and principals and we were a part of this action during a day. We arrived at nine in the morning when the children were eating breakfast and the mothers were starting their knitting lessons. The children are then divided into different groups; the younger ones in the ludoteca (a play house), while the older children go to class. The older children had two teachers who were strict about the rules during class, to prevent a smaller chaos in the room. Securitas believe that these children need structure and discipline in their lives that can be useful throughout their whole life. The Vice President of Securitas, Gina Muniz, said it is not their responsibility to educate the children, which is the responsibility of the government, but they give the children better opportunities and especially motivation to perform in school. If the children behaved correctly during the one and a half hour in class, they were allowed to play and swim in the pool. All of these activities took place at Securitas own facilities (see attachment 2).


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1.2 Problem discussion Companies in foreign markets that want to gain legitimacy can engage in social issues in the market of operation in order to receive the legitimacy desired. Social responsibility is becoming more important both for the stakeholders of a company and for the company itself (Holmestedt et al 2009). In recent years large multinational companies have perceived more pressure from outside actors to be good corporate citizens and as the competition stiffen the image and reputation of a company is becoming more vital. Companies need to secure their international position as the companies expand further across the world. If a company acts as good corporate citizens they will not only gain more sales and good word of mouth but also commitment and trust from their employees and society, which will benefit them in the long run (Pedersen 2006). While the trade barriers are decreasing it sets higher demands on companies to act in a certain way and have a good image within the society to maintain sustainable growth. Legitimacy is then crucial to be able to continue their operations globally.

It is important for companies to interact with their stakeholders in a positive way to be able to have sustainability in an emerging market where the relationships are the core of a long-‐term commitment. The stakeholders are the ones that can affect a company both direct and indirect and therefore are a major part of the future of a company. The relationship towards your stakeholders is the best way for your company to evolve and continue the development of your CSR practices and therefore companies should lay focus on their stakeholder relationships (Holmestedt et al 2009). Having a thorough communication with the surrounding environment is also becoming a more critical point to be able to be competitive on a market. Studying the concept of CSR involves theories connected to relationships and commitments, such as the stakeholder and legitimacy Theory (Pedersen 2006). Legitimacy and relationships goes hand in hand when talking about CSR, they are the core of sustainability and CSR practices, which is why they are important to discuss (Carol 1991). We are all individuals with different preferences so therefore when discussing and debating issues concerning legitimacy it is complex in the sense that it differs from organization to organization, both the definition of what stakeholders and what legitimacy actually are.

During the last decade CSR have been adopted not only by voluntary organizations that are designing social and environmental management standards, also by academics and consultants in articles, papers and books. Governments and international organizations increasingly integrate CSR in policy papers and while companies have started to report on the social and environmental impacts, investors place money in companies that are social responsible. Still there is an on-‐going debate whether companies have only a financial responsibility or if they also have social responsibility in a new market of operation, and the question remains what social responsibility actually consists of and that the practical perspective of CSR is difficult to grasp (Pedersen 2006).


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1.3 Questions -‐ How do Swedish MNC´s work with corporate social responsibility in an emerging market?

-‐ What kind of CSR do Swedish MNC´s practice in the emerging market and why?

-‐ How do external stakeholders in the emerging market influence the CSR involvement of the Swedish MNC´s?

-‐ How do the Swedish MNC´s get legitimacy from the society and their surrounding environment in the emerging market?

1.4 Purpose The purpose with this thesis is to describe the different CSR actions of our chosen organizations to gain understanding of how Swedish multinational corporations work with the subject in the emerging market. We will study what kind of CSR they are implementing on the market and how their surrounding environment influences them. From a theoretical perspective we will analyze the impact of the stakeholders and how they gain legitimacy, further how this is taken into practice. Thereafter the actual actions will be concluded in order for us to be able to give a recommendation.

1.5 Limitations We have chosen to focus on three Swedish MNC´s CSR concepts in the Peruvian market as a foundation for our study. We will also interview the Nordic Chamber of Commerce and the General Council of Sweden in Peru to get a broader view of the social responsibilities in the country. Our main focus is the external CSR, but will briefly include the internal CSR as well because it provides an overall picture of the CSR concept. Different theories are used to base our thesis on where the stakeholder theory and the legitimacy theory are in center of our study, both widespread theories that are essential to our thesis. Moreover, within the three companies we have chosen we will not advert CSR actions taken place in Sweden when our area of interest is Peru.


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1.6 SIDA (Swedish International Development Agency) This thesis has been made possible by financial support from SIDA that enabled the authors to travel to and spend the thesis-‐writing period in Lima, Peru. SIDA works according to directives of the Swedish Parliament and Government to reduce poverty in the world. Minor Field Studies (MFS) is a scholarship program for field studies in developing countries. It is intended for students at universities and university colleges with an international interest, who wish to gather material for their Bachelor or Master dissertations for periods of 8-‐10 weeks. It aims to provide Swedish students with the opportunity to build up their knowledge of developing countries and development issues (www.sida.se).


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2. Methodology In this chapter we will introduce the choice of subject and describe our methods to further explain and motivate our different approaches concerning our research.

2.1 Choice of subject Our interest for business and social development made us curious about companies’ social responsibilities when operating in emerging markets. The South American market is growing but still huge parts of the people are living in poverty. That led us specifically into the Peruvian market. We became more involved in the subject and understood that CSR is an important part considering a company’s ethic position as well as their competitive edge.

2.2 Research strategy With qualitative research the information gathered is analyzed; as well as in the quantitative research, and provides more creativity for the researcher, which can lead to new discoveries. In accordance with Merriam (2005) we believe that research concentrated upon discover, insight and understanding of the basis how people perceive the world provides the best opportunities for development of knowledge within the area of interest. The performance of a number of interviews with persons that we think can contribute with important information to our thesis, made us creative in that sense that we afterwards discussed and questioned theories we are using and also tried to find new solutions to our problems. Qualitative research is in the contrast to the quantitative focus more traditional in that sense that there is only one objective reality that is constant and further on is to see rehabilitation in the result. In our case statistics and numbers are not relevant which is the quantitative strategy main focus, our focus is set on observing and gathering information from our interview objects, we are interested in people’s thoughts and opinions within the subject. That is the reason for choosing the qualitative approach. In qualitative research the process, the meaning and understanding are of greater interest. The use of words and pictures rather than figures is tools to describe the discoveries gained by the researcher. Bryman & Bell (2002) claims quantitative researchers sometimes criticize qualitative investigations because of their too impressionistic and subjective ways. Quantitative researchers state that of the reason that a qualitative researcher often starts in a relatively open way and only gradually precise the questions, the reader can receive somewhat poor information of why an certain area is chosen to be studied and not another.


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2.2.1 Case study

A case study is a study of a specified phenomenon, such as a program, an event, a person, an institution or a social group. Learning from a particular case should be considered as strength rather than a weakness. The interaction between a phenomenon and its context is best understood through in-‐depth case studies. To an increasing extent, the case study approach has become a common method in many scientific disciplines (Dubois & Gadde 2002). We have put emphasis on qualitative case studies, as most case studies are related to practical problems from a holistic perspective. This means that a researcher chooses the case study method to gain deep insight into a particular situation and how the persons involved interpret this. Focus is set on process rather than on results, rather than on context-‐specific variables and to detect rather than to prove (Dubois and Gadde 2002). In a qualitative case study the researcher seeks a greater understanding of the case. The researcher wants to understand and integrate her to the complex context that a case study is. Qualitative research has an extensive history with the human kind’s curiosity as an engine. Which has been the case for us, we wanted to know more about this specific problem and gain more knowledge of the chosen case. When choosing a specific case it is important to choose a case that is typical or representative of other cases. To have case studies as a research approach is not primarily to see or connect your study to others done in the area, the main reason for conducting a case study is because the researcher wants to understand that specific case, which means that the case is pre-‐selected (Stake, 1995). A definition of a case study follows: “Case study is the study of the particularity and complexity of a single case, coming to understand its activity within important circumstances “(Stake, 1995). To have been given the opportunity to perform a case study did not only help us to receive a broader view of the problem but also enabled us to study the problem on a deeper way, when having the opportunity to do a field study and see the peoples actions and reactions before during and after the interviews.

2.3 Research approach In researching there are different approaches and questions that need to be considered; the relation between the empirical material and the theory is crucial for having a well-‐executed thesis. There are three different ways to proceed with a thesis: the deductive, inductive and abductive approach. Clear inductive research begins with gathering of data and continues with empiric observations and thereafter the researcher uses theories depending on the


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information that is found Merriam (2005). A researcher that works with the inductive approach follows the path of discovery, which means that she can study a specific object without any deeply rooted knowledge about an already established theory. After receiving the empirical findings the researcher will formulate a theory, which is on the contrary from the deductive way of working. That means that in use of an inductive approach the researcher shall discover something and gain knowledge enough to explain and formulate a theory. The deductive approach means that the researcher uses established theories and studies a specific phenomenon: the deductive researcher turns theory into empiricism (Bryman & Bell 2005). The abductive approach is a combination of the deductive and the inductive approach, however Dubois & Gadde (2002) say that an abductive approach is only relevant if the researcher has as an objective to discover new variables and relationships. In our case this suits us because we are having an objective to discover new relationships or angels to the CSR framework. The authors’ stress that the systematic combination that is most suitable when performing a case study is more related to the inductive approach than the deductive, because of the continuous change between theory and empirical observations is more based on what they call grounded theory. Performing a case study provides a good prerequisite to develop theory by having opportunity to see the empirical observation in another context. There are many methodology textbooks that fail to take into account the benefits that come with performing an interview when conducting a case study, which other authors describes as a linear process (Dubois & Gadde 2002). Abductive means that the researcher could formulate a hypothesis pattern from one case that could explain the specific subject chosen to study and provide suggestions for a deeper structure. The first step that an abductive researcher takes is an inductive way: where a theory or hypothesis is created. Secondly, the theory is tested through new cases: and the researcher works deductive. The advantage that the abductive approach has is that it is more opened compared to the other two approaches Patel & Davidson (2003). We have chosen an abductive approach because it gives us more room for analysis and reflections which we believe suits us better then the inductive and deductive approach. It would give us the opportunity to explore new angles through our gathered empirical findings. After we have obtained theoretical previous knowledge we will carry out an empiric study and finally compare the empirical findings against the theory to see if these two match. This shows that the most suitable approach for us is the abductive approach. We will be able to gain knowledge from the theoretical frame and also receive understanding from our empirical findings, which will bring us a broader view of the problem and simultaneous give, us a more satisfying end result.

2.4 Data gathering The written sources possess an information source that is huge if we consider the CSR concept in general, but very limited in different areas within our specialization. Moreover, is the issue to choose the relevant information from the documents that provides information from different kind of views. The documents most important issue is that they are able to in every way help the researcher to discover meaning, develop understanding and mediate insight of relevance for the researcher. The value of the information source must also be


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relevant for the formulated questions. There are two different types of data sources. Primary data is the material that is gathered for the actual research area. In this thesis the primary data consists of interviews. The secondary data is data that already exists and have been gathered by other researchers or institutions (Merriam 2005).

2.4.1 Gathering of primary data

To base the thesis upon only written facts was never a consideration for us. Jacobsen (2002) says that by having face-‐to-‐face interviews the researchers are given an opportunity to see a more honest and fair atmosphere in comparison when performing a telephone interview, where it is easier for the interview object to not give correct answers. We choose to perform interviews. An interview guide with partly structured questions was created for the companies of interest, but with some orientation depending on differences in the companies CSR work (sees attachment 1) (Merriam 2005).

We chose to meet our interview objects in their everyday environment from the 5th of April to the 5th of May. We conducted one interview with each company and organization. We felt like we received complete answers during the interviews and did not have to conduct any more.

When using a qualitative method, a low degree of standardization of the questions is preferable. A low degree means that open questions are used and the respondents have the opportunity to answer relatively free (Patel & Davidson 2003). Personal interviews ease the communication and we presented the subject for our interview objects and sent in the questions on forehand if desired. The respondents were supposed to be able to prepare themselves so that we would receive correct and thorough information. A qualitative research reflects people’s opinions, how they act and their experience within the area, which we believe is the most interesting part in research. We created our interview guide in accordance with our four formulated questions (see background), and on the basis of them we phrased our questions. We divided our questions under different headings that we connected with our theoretical framework. We sent the main questions to the respondents in advance even though we earlier on the telephone discussed the subject of our thesis. We wanted the respondents to be able to prepare so they could answer more detailed and if needed find information for the interview in forehand to prevent uncertainties to occur. When we conducted the interview we started by presenting ourselves and explained that we were enabled to conduct this thesis in Lima, Peru thanks to SIDA. We then continued to ask simple questions about the company and the Interview person in order to proceed with the more deep questions about their CSR work. We did this in order to receive a broader view of the organization, the person and also their CSR commitment.

2.4.2 Gathering of secondary data

We tried to find the most suited interview persons for our thesis that could provide us with valuable information within the CSR area. In our point of view all of the persons we interviewed had specific and important information concerning our subject. The MNC: S we choose to interview were all companies that had a relatively long experience of the Peruvian


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market because by interviewing MNC` s that has a long presence in Peru they will most probably be well aware of issues concerning the Peruvian society. The people we interviewed where all involved in CSR actions and procedures. We also choose to interview the president at the Nordic Chamber of Commerce and the General Council of Sweden, because we believe that to be able to receive a broader view of the studied problem we have to involve interest organizations as well as companies in order to achieve a more reliable end result. The Nordic Chamber of Commerce and the General Council provided us with a more objective view rather than just relying on the information gathered from the companies. The interviews took place at the companies’ offices and at the organization headquarters or their own facilities. All of the conducted interviews took more or less two hours, which gave us a deeper connection to the person and also a greater opportunity to receive as much important information as possible.

The interviews took place between the 5th of April and the 5th of May 2010.

Ignacio Francisco Menéndez Larrea, General Manager of Atlas Copco Perú, 2010-‐04-‐05. We had the interview at Atlas Copco headquarters, Santa Catalina, Lima Gina Muniz, Vice President Securitas and President of the Association Securitas Peru, 2010-‐04-‐29. The interview was conducted at Securitas headquarter, Surco, Lima Lorena Perez Helden, Marketing Director & Sustainability Director SKF, 2010-‐04-‐15.The interview took place at SKF`s headquarters, San Isidro, Lima Stefan Sandberg General Council of Sweden, Peru, 2010-‐05-‐05, the interview was conducted at the office of the Swedish General Council, San Isidro, Lima Raul Alta Torres Aguila, President of Cargamar & Vice President of Nordic Chamber of Commerce 2010-‐04-‐19. The interview took place at the headquarters of Cargamar, San Isidro, Lima To gain more understanding for the subject, we read articles and literature where CSR is treated. Information about CSR is widely spread, even though CSR in South America is a much more limited subject, furthermore CSR in Peru. We have used a lot of scientific articles from the databases ELIN and Google scholar as well as literature that thoroughly describe the different theories in the area as well as essays within the subject of CSR. Furthermore web pages concerning for example the Global compact, ILO and our case study company’s web pages. Most of the scientific articles we have used are from known business papers such as the international business review and the business and society review, which give them high creditability.

2.5 Procedure We started to search for Swedish companies operating in Peru; there are 27 MNC`s operating on the Peruvian market (swedenabroad.se). Continuously we started to look at the company’s web pages and choose 10 companies that we thought would be interesting


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for our thesis. Then we formulated an email explaining our study and why we thought that their specific company would be interesting for us to interview. After we received answers from some of the companies we choose the ones that we felt gave us the best feedback and that we received a good impression from. Because we felt that having a good connection with the companies from the start would benefit us in the end when we had our interviews in Peru. We felt that during our interviews the conversation went smoothly and our interview objects felt comfortable and relaxed during the whole interview. The respondents took a lot of time both before the interview and after to answer our questions and were very helpful. Both of us were present at all of the interviews and both took notes and complemented each other if one of us forgot to write something down. According to Jacobsen (2002) conducting an interview with a recording device is preferable rather than taking notes during the whole interview, because then the researcher can concentrate on what the interview object actually is saying and create trust between one and other. The fact that we used a recording device eased the information gathering for us because then we had the answers recorded and could listen to them many times, and did also give us a chance to analyse what the interview objects answered. Doing a transliteration of the interviews also helped us in case we needed to go back and listen to the interviews once again for complementing further; we had the interviews both on paper and on tape.

2.6 Research quality

2.6.1 Validity

Validity means that the object that was supposed to be researched has been researched. When having a qualitative approach the validity is valid through the whole process because when having a qualitative approach it is about interpreting and understanding rather than to measure a problem (Patel and Davidson 2003). We have listened to the interviews several times to avoid misunderstandings when writing the transliteration and in this way receive a more valid result. The theoretical framework is based on scientific articles written by known researchers in the CSR area and we have also used written essays to get a broader view of the subject.

There are different types of validity and it is measured by how accurate the gathered data material is compared to the approach of the problem (Patel and Davidson 2003). The validity that is most common concerning qualitative studies is competence, pragmatic and communicative validity. The ones we have chosen to work with are the competence validity and communicative validity. We have interview objects that are experts within the field we are studying which gave us relatively valid answers and also gave us a chance to be as objective as possible when seeing the person face to face (Patel and Davidson 2003).

The fact that we use a qualitative approach gave us the opportunity to have thorough dialogs and discussions with our interview objects. When we prepared for the interviews we


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did previous research about the targeted companies and their CSR work. This helped us during the interview and for us to receive better answers. One example is that our interview objects did not have to explain global policies for us because we were already aware of them, and instead we could discuss them rather then having them explained for us. This gave us a deeper understanding of the companies at the same time as it gave us more valid answers.

2.6.2 Reliability

Reliability is more commonly used when having a quantitative approach. Reliability is about creditability rather than a measurement that is more suitable for quantitative research and therefore the reliability can be higher when having a qualitative approach. When talking about reliability the researcher has to measure the reliability in that specific situation that you are studying at that time, because if you do not see it as an isolated situation the interview objects could change their opinions in certain questions and the reliability would change from the first interview to the second one. The reliability during a qualitative approach is mostly based on the researcher’s capability to interpret and go through with the interviews in a proper way (Patel & Davidson 2003). Bryman (2002) states that there is something called internal reliability and that is how the persons that are doing the interviews are influenced by the things they hear and observe. Both of the authors of this thesis had previous knowledge of doing interviews during their studies at the University. The fact that we have had all our interviews face-‐ to-‐ face gave us a great opportunity not only to receive more reliable answers by seeing how the person reacts to certain questions but also to observe patterns and how the interview objects behaved. To meet a person face to face makes it easier to connect and can definitely be an advantage for us when doing our analysis.

2.7 Criticism of the sources According to Bryman & Bell (2005) it is important when doing a case study that the researchers have a critical approach towards the methods they are using. That is why we are aware of the advantages and disadvantages with having a qualitative approach where the researchers get more influenced by the impressions and the behaviors of the interview objects. We still believed that in order to conduct our study personal interviews where of great significance. We are aware of when having interviews with persons within a company that they will probably not be negative about the company and will also try and put themselves in positive light the same goes for the organizations we interviewed. The people we have interviewed at the companies and organizations are involved in the social responsibility and sustainability work and are professionals, so we choose to rely on that the information they provided us with was correct in that sense. The disadvantage with case a study is that they are very dependent on the researcher, which could limit the study if the researcher has lack of understanding of the subject and inability to analyze the information. Case studies can also be simplistic or exaggerated which can mean that the reader could misunderstand the study. The advantage with case studies is


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that they are established in real situations and which results in a story of the phenomenon that is comprehensive and holistic. The methods broaden the researchers and readers knowing and develop the knowledge base within the area. The issue of generalization has muddled case study researchers for a relatively long time. Part of the difficulty lies in interpreting the concept of generalization in the same way as if you were talking about experimental studies or related studies (Merriam 2005). The articles and theories we used are mostly well known and are published in famous business papers. Carroll’s pyramid, the stakeholder theory and the legitimacy theory are all well established in the literature of international business. The fact that the CSR movement in Peru at the moment is not as far in the development as other countries makes it harder to find reliable sources within the Peruvian environment. Therefore we had to generalize more and see it from a point of view of more industrialized countries; the fact that we are studying Swedish MNC´s in Peru gave us a narrower search. The articles we have used were found at ELIN through the Linnaeus University, which is a search engine with only scientific articles. We also found interesting articles on Google scholar. If the researcher is insecure of the value of a document, she can choose to use many different sources to come to realization and knowledge. An important problem can be to estimate the truth-‐value in the material. All civic information consists of deformity even if it is claimed to be objective, and this can be unfamiliar for the researcher. Importantly is that the material is critically viewed concerning origin, author and the context of belonging (Merriam 2005).


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3. Theoretical framework In this part of the thesis we will introduce theories that will be used to knit together our empirical findings and the theory. We will concentrate on external CSR: the stakeholder theory, the legitimacy theory and address corporate communication. Criticism of the CSR framework will also be included in order to be more objective. There are different definitions of CSR; below two are presented: "Operating a business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that society has of business (Business for social responsibility). “A concept whereby companies decide voluntarily to contribute to a better society and a cleaner environment, A concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis" (The European Commission).

3.1 Background CSR: The concept of CSR is not a new phenomenon; in 1953 the economist Howard R Bowen said that all companies should take responsibility for their actions, when for example exploiting the natural resources of a country. The usage of CSR nowadays is often integrated into high management level due to the new socio-‐economic models that the market demands; companies should involve other areas into the business strategy besides making profits. (www.oxfarmamericaorg 2008). Michael Porter (2006) said “CSR can be a cost, a constraint, or a charitable deed-‐ it can be a source of opportunity, innovation, and competitive advantage”. More and more companies are now adopting the CSR framework into their business strategy because they have noticed that the usage of CSR is a favorable strategic tool to increase revenues and market shares, especially concerning the external CSR. Michael Porter made an outlay about why CSR should be a concern for all companies and he summarized them into four areas – sustainability, moral obligation, reputation and license to operate. It’s crucial for a company to interact with the CSR framework in every unit of the business from internal human resources to external actions in order to see how the impact of the CSR framework can be successful (International Business ethics 2009).


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Corporate social responsibility has a different meaning depending on the person that is asked. For some people CSR means liability or legal responsibility while for others it means socially responsible behavior in an ethical sense. Still many people connect CSR with charity or being socially aware, it is also a concept that is trying to be a synonym to legitimacy, so that people hearing about being socially aware directly connects it to legitimacy (Okoye 2009).

Company activities are demonstrating the inclusion of social and environmental concerns in business operations. CSR is concerned as the relationship between business and society. CSR means different things to people at different times, but the nature of CSR consists of related concepts such as corporate citizenship & accountability, sustainability, business ethics and triple bottom line that have contributed to the confusion about the true nature of CSR (Pedersen 2006). CSR is a subject that is widely discussed, which means that the definitions of CSR are many. This creates further confusion of the subject and different points of views if CSR is to be implemented or not. Milton Friedman (1970) for example stated that CSR and being socially responsible is nothing companies should be dealing with, the main purpose of a business is to make profits, and on the opposite Michael Porter says that companies have moral obligations towards the society considering the exploitation. Therefore it is difficult to answer the question if CSR a given or a waste of time (mallenbaker.net).

3.1.2 The CSR movement in Peru

Even though corporate social responsibility is far from attracting large interest in Peru, it is gaining importance and companies have increased their level of engagement. The companies that are dependent on exporting their products put more action into CSR than the domestic market producing companies. The mining industry have advanced and implemented the most CSR actions, of reason that they are being specially observed. The companies are obligated to pay part of their revenues for infrastructure and social projects to the communities that are affected by the mining. The money goes to regional governments and local administrations (German embassy, Lima).

The deputy foreign minister of Peru, Gonzalo Gutierrez Reinel, has said that the corporate social responsibilities are an important issue to discuss on a global level. He has pointed out the social problem in the contrast between the poverty in the Andes, and the billions dollars of profit international companies are making from gold, silver and copper (mallenbaker.net).

Still, Peruvian policymakers do not yet regard corporate social responsibility as an important topic. Only one legislative proposal was introduced 2005, but did not go through. NGOs like Peru 2021 and SASE has a certain interest for the subject but there’s an issue in reaching out


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to the population, and a rather uninterested media also plays part (German embassy, Lima).

On the contrary, membership of Peru 2021, the business association that promotes CSR, has increased from 16 to 83 corporations from 2003-‐2008. Also, there are a growing number of local companies that have signed Global Compact, which is a step towards implementing CSR actions (Apec.org).

International organizations play a relatively important role in promoting CSR in Peru. A number of this organizations support the technical and financial assistance for the Peruvian CSR organizations. Political foundations are supporting projects to gain awareness of CSR (German Embassy, Lima).

3.2 Internal and External CSR

3.2.1 Internal CSR

Within the CSR framework companies can take different paths, they can concentrate on external or internal CSR, If not both. Internal CSR focuses more on the internal dimension of a company such as their employees and collaborators. Within the Internal CSR there are four dimensions to implement;

• Corporate governance • Motivation and incentives • Health and safety • Human capital development

The first dimension of the internal CSR is corporate governance, which means that companies should try to achieve transparency in all their activities to be able to preserve their relationships towards their stakeholders. They should also give their surroundings an insight of relevant data and follow the rules concerning corporate governance and defining the behavior and responsibilities of the board. The second dimension is to motivate and create incentives; companies should actively involve and have an exemplary management function on the sustainability topics for the whole organization. They also have to create incentives monetary and non-‐monetary to motivate their staff and to create a sense of trust. Then the employees will in the company for a longer period of time instead of being in loyal, which creates sustainability. The third dimension is health and safety; companies should guarantee the safety and health of their employees and protect them from risks that can occur while working in the organizations. Health and safety is a crucial subject concerning internal CSR, to have safe productions and working conditions. The last dimension is the human capital development. These are issues concerning education and training of the employees; companies need special programs concerning job enrichment and job enlargement. To develop the human capital also is a way of making the


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staff satisfied to obtain the valuable human capital within the organization instead of outsourcing (Baumgartner & Ebner 2009).

3.2.2 External CSR

The external CSR of a company concerns issues that do not involve the company directly but can influence their practices anyway. Within external CSR companies often work closely with outside organizations and with their stakeholders. The external CSR is in general the side of the CSR that is most easily viewed by the society. How a company can be a good corporate citizen is a core part of the external CSR. There are four dimensions considering external CSR:

• Ethical behaviour and human rights • No controversial activities • No corruption and cartel • Corporate citizenship

The first dimension is ethical behaviour and human rights; companies should act correctly in order to maintain sustainability. They should have a code of well-‐established principles, cooperate with organizations and cooperate with their stakeholders. It is also crucial for companies expanding abroad to take into consideration cultural differences and to respect the host country’s cultural societal rules. It should not occur or harm concerning nationality, gender nor religious belief. Next dimension is to have no controversial activities such as producing uranium or exploitation of natural resources without any consideration. Companies should not use sales of assets or goods for non-‐sustainable activities. The third dimension is to not encourage corruption and cartels nor be a part of it. Companies should act fair on the market and avoid having manipulative business practices; this includes neither having price fixing nor breaking rules. The last part considering companies that practices external CSR is as we mentioned above, to be a good corporate citizen. To be a good corporate citizen does not mean that a company should just contribute to the economic wealth but also to increase the social standards of the country they are active in. It is also of a great importance that companies work with their stakeholders and other organization to be able to see which needs are necessary in the country. Companies can be good corporate citizens on a national level by conserving subsidiaries and to increase society’s living conditions. On a regional level companies can participate and create sustainable activities for the community where present (Baumgartner & Ebner 2009).


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3.2.3 Corporate Communication

Having a new global scene where it is said the competition is becoming more intense and that society is demanding more corporate citizenship, the stakeholder theory and perspective is becoming more important than ever. Nowadays companies cannot please their stakeholders with neither financial nor legal actions, organizations has to go further to respond to the different demands that their stakeholders are requiring. The corporate communication is a part of the overall strategy and vision of the company, together with symbols, culture and behaviour this is a platform of values or the common starting points of a company from where both the internal and the external communication is based (Ellerup Nielsen & Thomsenn 2009).

A definition of corporate communication follows: “Strategic integrated communication related to the task of coordinating internal and external communication, from a strategic to an operational level, with the aim of building and maintaining an organization relationship with its stakeholders (Ellerup Nielsen & Thomsenn 2009). When having a communication and reputation management perceptive, the CSR practices has to be integrated into the overall business strategy of a company in order to become a crucial part of the company. Stakeholder dialogue or corporate communication may assume different forms; it can be everything from information about the company’s conduct to an open dialogue concerning different issues that are of significance both for the stakeholders and for the company itself. The fact that the stakeholder dialogue can have a very wide nature it is important for companies to have an analytical framework to evaluate how they actually integrate their stakeholders in the decision-‐making process. CSR is based on a relationship between business and society, a relationship that makes companies communicate with different groups. Of course trying to have a thorough dialogue with all of a company’s stakeholders would be impossible because insufficient capacities. Therefore in order to manage the complex nature of corporate communication it is necessary to create a model that obtains less information than the phenomenon it will try to describe. So that means that in order to make corporate communication operable companies cannot take all stakeholder concerns into consideration (Pedersen 2006).

3.3 Stakeholder Theory When CSR is discussed, the stakeholder theory has become the common frame of reference. According to the stakeholder model, a company has to be aware of the demands of its employees, customers, investors, suppliers and the local community and additionally respond to them. On the other hand the shareholder perspective is that business is about economic and not social goals, and therefore companies should not focus in the area. But in real life situations economic decisions also have social consequences. CSR argue that


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companies have responsibilities towards the stakeholders even if it pays off or not. Furthermore, companies should not be in business if they do not act in accordance with the norms and values in society (Pedersen 2006). The stakeholder theory is widely known and is used to analyze specific groups in society that companies should cooperate with and act responsible towards. The stakeholder theory was first used in the beginning of the 1960s and at that time it was defined as “those groups without whose support the organizations would cease to exist”. Edward Freeman is the person that has stated the definition of the stakeholder theory in the 1980s and his view is the most accepted view today (Holmstedt et al 2009). A stakeholder can be an individual or group that can be affected or affect the company’s goals. The sustainability and the success of a company are often based on the interaction between the company and its stakeholders (Vokbus & Stål 2009). The stakeholder theory is difficult to avoid when discussing CSR; stakeholder theory is necessary to be able to operationalize CSR (Holmstedt et al 2009). Phillips (2003) means that many academics and businessmen argue that business is business and moral and ethics is not connected to the business, but continues, on the contrary they are interconnected and that this is a huge moral obstacle that organizations has to overcome. The stakeholder theory can be used to analyze which stakeholders should be considered and focused on and also why companies should have CSR practices. Below follows a model of the stakeholder theory;

Figure 1: Donaldson and Preston, 1995


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3.3.1 Primary and secondary stakeholder

Within the stakeholder theory there are two main groups, the primary and the secondary stakeholders. The primary stakeholders are customers, suppliers, employees and owners. They have a direct impact on the company’s development and results. Secondary stakeholders could be NGO: s, media and the government which do not have direct impact on the company’s business but the company still has to bare them in mind when developing their business strategy because of their importance concerning potential cooperation’s and alliances (Holmestedt et al 2009). The responsibility of a company has until recent years been to just generate good financial results and to please the owners, while today companies responsibilities reach further. Companies today have an obligation to act correctly towards both their primary and secondary stakeholders and that is why companies ease implementing legal obligations such as environmental standards and work conditions. The fact that the stakeholder theory is very wide and can be defined differently depending on the persons or organizations definition. It is the most positive and negative aspects of the theory because analyzing which ones are your stakeholders can be very different from company to company. That makes it hard to have a framework that can be used everywhere. According to Phillips (2003) the theory is really helpful when companies want to concentrate on their stakeholders and for example environmental and social issues. He also states that because of its openness it makes it very easy for critics to question the theory.

3.4 Legitimacy theory MNC: s can have different degrees of legitimacy. Companies gain, loose or maintain legitimacy and one way to gain legitimacy is by matching your business strategy for societal advantages. The level of legitimacy varies and depends on how much benefits or sacrifices the stakeholder perceives conducted by the MNC. Competitive advantages in an emerging country is based and created by natural values, economic values and social values. If a company takes social responsibility the impact on the competitive advantage is positive if it leads to the company gaining more profits compared to their competitors (Jansson 2007). There are three different ways to gain legitimacy from a market and depending on which is of greater importance for the company, the outcome of the legitimacy received from the societies varies. Firstly, practical actions are one way to gain legitimacy; Companies actual activities concerning practices bring the company legitimacy. Secondly, it is the company values and culture, the reputation and the image of the company that customers can relate to and that society has a positive impression of. Companies should send out their message and have a clear view of how they want to portrait themselves on the market. The third way of gaining legitimacy is through the stakeholder’s view of the practical actions that the company precedes with (Vokbus & Stål 2009). The legitimacy theory is a continuation of the stakeholder theory. While the stakeholder theory concentrates on the stakeholders, the legitimacy theory set focus on how the company can receive legitimacy from their surrounding environment. The company values and standards are the ones that are crucial when trying to gain trust and commitment from


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the stakeholders. Legitimacy can be difficult for the company to accomplish because we are all individuals with different preferences. The legitimacy theory says that the company has to be aware of the values that society has, thereafter implement a strategy that fits both the company and society, for sustainable growth and uphold the image (Vokbus & Ståhl 2009). According to Cederholm & Svensson (2009) the legitimacy theory is based on a “social contract” between the society and the organization. The social contract should represent the expectations that the society has on the company; after regarding the societies own rules and values. The problems that can occur with the legitimacy theory are that society’s expectations change overtime, so companies have to be flexible and adjust to the new “standards” in society. If a company recognizes that they are not following the society’s values and norms they have a problems to take actions against (Deegan 2002).

3.4.1 Carroll’s pyramid

A model that is still used today when it comes to legitimacy is Carroll's pyramid. It consists of four areas: economic responsibility, legal responsibility, ethical responsibility and philanthropic responsibility. Carroll (1991) says that the main purpose of a company is to gain profits, but at the same time as the owners’ demands high rate of return, the employee wants security and a fair salary. The customers want good quality and these issues are within the frame for economic responsibility of Carroll's pyramid. The legal responsibility means that a company has to take the laws and regulations of a country into consideration. Carroll says that for a company to have sustainability the company has to consider rules and values that the society requires. The ethical responsibility consist of what expectations and obligations of doing what is right and fair, but also which precautions the company has to take to not do any harm. Philanthropic responsibility is actions that can contribute to education or help in different aid projects and it is also called the external CSR of a company. A substantial difference between ethical responsibility and philanthropic responsibility is that a company is not obligated to take philanthropic responsibility. It is more about the company itself, which image they want to portrait out to their stakeholders and their internal environment. The criticism against Carrols pyramid is that two of the responsibilities cannot be put against each other, so that you have to view this pyramid as a whole. The cultural aspects is something you also have to consider when using the pyramid as a base of the CSR work of a company, depending on the culture of the country has and the way of doing things could be very different from country to country (Carrol 1991).


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Pyramid of Corporate Social Responsibility

Figure 2: (Carrol 1991)

3.4.2 Triple bottom Line

The Triple bottom line concept (TBL) states that companies do not only have economic goals but also environmental and social values. John Elkington (1989) introduced the term TBL with economic goals, environmental goals and social values, as the base of sustainability. When the TBL was founded during the late 90’s many changes concerning financial aspects and trade barriers were occurring and the technological development, such as the Internet, was going through a huge boom. In this way the globalization and development of new technologies was the kick-‐start of making sustainability and TBL was observed in the media. One part that the TBL suggests is that companies should not only declare the results but also their contribution to a better environment. Elkington (1989) means that instead of just talking about the financial results, the company should also value the people, planet and profit. By using the TBL as a part of the business, companies can gain economic advantages because customers today are getting more and more product sensitive and desire to consume from a trustworthy company. Today companies have to provide the customers more value and take responsibility for the environment to not loose profits and reputation. Another reason for companies to use the TBL is that with this strategy they can differentiate themselves on the market (Cederholm & Svenssson 2009).


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3.5 Codes of conduct A code of conduct is a policy where the company formulates ethical requirements that are crucial for the company and their cooperation partners to follow (www.efg.se). Corporations public commitments to certain standards of conduct can serve both corporate and public interest enhance human welfare, advancing regional economic development and strengthen democratic institutions. Codes of conducts are here to stay; they are both desirable and necessary. All MNC´s need to be able to know how to implement a code of conduct, but not without their stakeholders. Trust among the stakeholders means a greater freedom for management. Codes of conduct must be economically viable for the corporation, bring up issues that are of importance for the corporations various constituencies (employees, communities, governments) and it must be specific (Sethi 2003). Atlas Copco, Securitas and SKF all have codes of conduct. Codes of conduct provides opportunity for responsible corporations to create highly positive public identity and reputation can have effects on customer loyalty, increased revenues and the productive workforce etc. MNC´s must be accountable and transparent for negative effect of profit creation (Sethi 2003).

3.6 CSR criticism

Freidman (1970) purposes that only people can have responsibilities, not “business”, even though a corporation is an artificial person and in this sense may have artificial responsibilities. Businessmen in believe that they are defending free enterprise when they declaim that business is not only concerned with profit but also with promoting desirable “social” ends, for example providing employment, eliminating discrimination, avoiding pollution and so on are according to Friedman’s article “the social responsibility of business is to increase its profits” (1970) preaching pure and unadulterated socialism and have been undermining the basis of a free society in the past decades.

In Freidman’s point of view, in a free enterprise, private property system, a corporate executive is an employee of the business owners and has responsibility towards his employers. This responsibility is to run the business in accordance with their desires, in other words make as much money as possible embodied in law and ethical custom. Exceptions can be for example hospitals and schools where the money profit may not be the main objective. But in both cases the corporative executive, is the agent of the individuals who own the corporation or institution and have responsibility towards them.

The corporate executive can according to Freidman (1970) spend his own money and energy on responsibilities he thinks is important, such as charity, his club, and his family. These are then “social responsibilities” of individuals, not of business. Acting in a way that is not in the interest of the employer’s mean that the corporate executives would be spending someone


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else’s money for a general social interest. The return to the stockholders reduces and the price for customer’s raises and it lower the wages of some employees because he is spending their money. Freidman states that the stockholders, the customers or the employees can decide themselves how to spend their own money.

This process raises political questions on two levels: principle and consequences. On the level of political principle, the imposition of taxes and the expenditure of tax proceeds are governmental functions. Constitutional, parliamentary and judicial provisions are established to control these functions, to assure that taxes are imposed so far as possible in accordance with the preferences and desires of the public (Freidman 1970).

CSR activities are like an iceberg, invisible. This means that it is an attempt to enhance and develop corporate domination rather then just wanting to portrait them in a good way towards society. The CSR movement has hidden motives; even though CSR should be a win-‐win situation and benefit both society and the company itself, it most often benefits society in one way but then resources in other areas are not as extended. One example could be when a company is giving away money for a charity the company is giving away their shareholders money and they could not use their shareholders money if they did not see a profit in it. CSR helps companies to take the attention from other more important issues, and in this way help them to gain legitimacy and give them access to markets that they maybe would not have a chance to interact with if it would not been for involved in CSR activities. According to corporatewatch.com CSR gives opportunities to companies to make ineffective market solutions and transform them into social and environmental issues. Of course CSR is an attractive tool because it helps companies to develop brand loyalty and develop a personal preference for their company from their customers. In today’s world where the media is such huge part of our globalized culture, companies are looking for all kind of different ways to improve market shares and profits and that is exactly what CSR offers, for example CSR contributes to potential venues through word of mouth or guerrilla marketing. A other positive effect of using CSR tools is that companies can cover up negative sides of the company, for example if they are exploiting resources then the company can give a lot of money to a charity and the focus in the media will be drawn to the positive activities the company is doing. Critics to CSR state that CSR is a form of reactions from the companies to take the focus from public mistrust and should be regulated because companies use CSR actions to avoid regulations (www.corporatewatch.com). One expression often used in CSR discussion is the phrase corporate citizens. According to critics corporations are not citizens on the contrary they are artificial legal persons. The term is used to describe companies that are trying in incorporate social responsibilities into their organization and also to create a new image for the company; a company that has feelings, rights which create a sense of democracy and moral that potential customer are drawn to, because they can relate that kind of company.


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4. Empirical findings This chapter presents a summary of the empirical material we have gathered through interviews. Initially we will present the companies and our interviewees, to continue with our interview material. This will enable us to describe the present procedure of their actions.

Atlas Copco is a global industry company, founded 1873. The company provides compressors, construction and mining equipment, power tools and assembly systems in 150 countries and has over 31.000 employees (atlascopco.com).

Ignacio Francisco Menéndez Larrea, General Manager

Securitas is a global security company with a history since 1934. Securitas are active in over 40 countries in North America, Europe, Latin America, Africa, Asia and the Middle East. Securitas employs over 260.000 people and have a market share of the global security market for about 11 percent (securitas.se). Gina Muniz, Vice President Securitas and President of the Association Securitas Peru SKF (svenska kullagerfabriken) is a global supplier of products, solutions and services within rolling bearings, seals, mechatronics, services and lubrication systems. SKF was founded in 1907 and has grown rapidly since. Today SKF is represented in more than 130 countries and employs 42.000 people (skf.com). Lorena Perez Helden, Marketing Director & Sustainability Director SKF Nordic Chamber of Commerce is an independent, apolitical, civil, non-‐profit association, integrated by natural persons and juristic entities or of corporate nature dedicated to commerce, production and services. Its purpose is to integrate and increase commerce between member countries and Peru and to strengthen existing relations between their entrepreneurs generating new business opportunities (camaranordica.org.pe). Raul Alta Torres Aguila is Vice President of Nordic Chamber of Commerce and President of the shipping company Cargamar. Mr Raul Aguila explained that The Nordic Chamber of Commerce is a new organization in Peru established in 2009 and that they started this organization to be able to knit together contacts and establish closer relationships with the Nordic countries and Nordic companies established all over the world. The Initiative of establishing a Chamber of commerce was made by the Finnish ambassador in Peru. The chamber consists of over 150 companies that desire to have a closer relationship both with Peruvian and Nordic companies. Raul Aguila said that the main goal for the Nordic chamber of commerce is to reinforce relationships between the Nordic countries and Peru.


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The General Council of Sweden in Peru, covers a wide scope of areas of which includes commercial cases, consular affairs, the promotion of Sweden and also cultural and information affairs (swedenabroad.com). Stefan Sandberg is the General Council of Sweden, Peru; Stefan Sandberg that is the general council of Sweden in Peru states; Swedish companies on the Peruvian market are associated with being reliable because of their long presence in the country. Multinational companies such as SKF and Atlas Copco have been active on the Peruvian market for many decades, which shows that these companies has had perseverance and been here in the good times and in the bad times.

4.1 CSR History and background Mr. Menendez, General Manager of Atlas Copco Peru, tells us that Atlas Copco has been active on the Peruvian market since the 1950´s. He has been working with issues concerning CSR since he started at the company 2002 and began by establishing a cooperation with an organization called Fundales, a private organization working with social care for children and families. He says that they cooperate in different ways, for example they donate annual fees to the organization and they also have different events where the issues concerning CSR are raised. The employees that are involved in the CSR work of Atlas Copco are Menendez and the Media/Communication Manager. Within Atlas Copco they have an integrated management system for quality and security; they are also using the ISO 9000 for the environmental and security issues. The HRM department is also involved in their CSR and sustainability work where they try to make the employees aware of environmental aspects such as recycling. CSR in Peru differs according to Menendez from industrialized countries and the rest of the world. In Peru corruption is more widespread which makes it harder to trust people and organizations and the social differences are more obvious. Though Atlas Copco is not responsible for this they still need to cooperate and communicate their CSR messages and interests.

Securitas has been active on the Peruvian market since 2005, when they made an acquisition of Forza, another company that provides security services. Mrs. Muniz, Vice President of Securitas, told us that CSR and sustainability issues have been a part of their work since Securitas established in Peru. They are right now two people working with social responsibilities and within Securitas they have their own social responsibility department and association. They work with both internal and external CSR and most of the departments at Securitas are in one way or another involved in their CSR practices. Muniz says that it is important to make every employee a part of their social responsibility work by arranging meetings and events to make their people aware of social problems in Peru.

SKF has been active on the Peruvian market since 1907 and because of their long presence they are well aware of the requirements for this specific market. Lorena Perez Helden is both the Marketing Director and Sustainability Director at SKF, she has been working with CSR for two-‐three years and they call the social responsibility practices for sustainability. She says that she is very lucky because she is able to work with both marketing, which is her career choice and at same time, work with people and help her country. SKF´s HRM department has


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right now a new position; social assistant which is their progress with their internal CSR. They also have a security committee, which Perez Helden is a part of. They have a committee that meet every once in a while and discuss the different projects and sustainability; all these actions are involved in the personnel practices. One example of how they try to involve the personnel in environmental issues is that SKF made their employees aware of the earth hour and participated in it.

4.2 CSR practice of the firms Mr. Menendez (Atlas Copco) explained that Atlas Copco work with CSR because Lima is a very though environment and that it is necessary to cooperate with the people of the country to be able to have resources on a global basis and to have sustainability in the country of operation. It is of great importance in Peru, especially on the countryside where Atlas Copco has their mining facilities to have a good contact and help the local communities. Most of these villages and communities are located on high altitudes with very small resources to live. Here Atlas Copco do cooperate with the local community to be able to have sustainability in their business, they do not want to explore the mine and then leave; they want to be able to have a sustainable future in the region and therefore they will have to develop the local society and make them a part of the technological and social development that Atlas Copco are implementing. Menendez believes that the areas of greater importance concerning a developing country like Peru are the environment and the poverty. To fight against poverty and establish cooperation’s with educative institutions is crucial for sustainability and a bright future. According to Menendez Atlas Copco areas of greater importance can be divided into two sides; the internal and external. With the internal area he means that the employees are their major responsibility, to recruit local people and they have a lot of emphasis on education and training of the employees. Externally he says that it is of great importance for Atlas Copco to sustain good relationships with the institutions in Lima. The fact that they are an industry company makes it very vital for them to maintain good relationships with the communities they are working in as well as their surrounding environment.

Securitas has its own social responsibility department, which focuses on the internal and external CSR. The internal practices is that they try to get all of the employees involved in social projects that they have and raise awareness of them. We took part of one of Securitas internal CSR actions that takes place every three months: A ceremony where board thank the workers and give them prices for outstanding performances in their work. It is a ceremony that points out the core values of Securitas and gathers all of the top management including the CEO. The reason for why Securitas has these kind of internal actions is because they are aware of the dangerous jobs their guards has and wants to show their appreciation and also motivate them to keep doing a good job. Mrs Muniz believes that by having this type of events Securitas creates a type of trust en commitment among the employees that will make them long running within the company.

Externally Securitas are focusing in projects in different regions of Peru where they have three main projects: Firstly, health projects where they will try to take care of children’s and families malnutrition and help them with urgent difficulties concerning their health. Secondly, are values and principles; once a week Securitas has a school for children the age


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of 2-‐12 at their head office facilities where they teach these children to be responsible and act with respect to their fellow human being. Except the principals and values lesson the children get to do activities such as dancing and swimming, and if they behave in a good matter they get to play free. Last is the Citizenship project; many of the families that Securitas works with are extremely poor and lives in Invasions and do not have a birth certificate which makes them non-‐ citizens of Peru. Securitas tries to help these families to receive these birth certificates in order to gain more saying in the society.

Mrs Perez Helden (SKF) states that the reason for SKF´s CSR work is their responsibility as a commercial company towards society. She believes that they have been able to make associations with people who have experience in community projects like NGOs or churches and thanks to their knowledge they have been able to promote important projects. Perez Helden says that a company has to be aware of that leaving a positive impact on the country of operation and not only to earn money is a very important thing that constantly has to be in consideration; to get back from the good things achieved and set an example for distributors is their responsibility. She continues that SKF is contributing to the economic wealth of the country, but that is not the only thing they should be doing. Except employing and giving job opportunities they have to be more like the Swedish example of the company.

Perez Helden thinks that mining companies has got the more responsibility because they are using the natural resources of Peru, so they have to give more back so that the living conditions increase and at the same time influence other MNC´s. Especially production companies have a responsibility of the development of the Peruvian society. She explains that they have three main areas that they concentrate more on: the business, the environment and the social area. With the business area she means that fore and foremost her job is to make sure that the company is profitable, she says that they have a budget to follow and even though she would like to she cannot be involved in all the different projects. The other area that they focus on is the environment. They try to recycle all the papers they use and with this recycling project they work together with a NGO, which takes care of the recycled paper. She believes that it is crucial for people to be aware of the environmental issues because we have a responsibility towards our children and their future. One of her statements followed:

“If we do not communicate out to our children about the environmental issues they will grow up without being aware of these problems, but if we to succeed with this communication we can help the environment a lot in the future”.

The last area that they concentrate on is the social area, which is the most important one for SKF. According to Perez Helden Peru is an emerging market so it is a country with many needs. It is a country where fifty percent of the populations live in poverty and she believes that every single person has to take responsibility for that even though she points out that the poverty and social instabilities are the concern of the government. She also says that with concentrating on social issues SKF can set an example for companies, which are not, that evolved concerning social responsibilities.

Mr Raul Aguila (Nordic Chamber of Commerce) believes that all companies have their own procedures concerning social treatments. If it is a company that explores the natural


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resources of a country they have to take responsibility for the nature and the surrounding communities. He says that he as a business man is most interested in seeing that the Nordic Chamber of Commerce helps with the investments that are done by Nordic companies and guide them in the right way, in Peru. On the contrary he says that the companies should search for sustainability internally and not rely on outside organizations.

4.3 External stakeholder influence Mr Menendez describes the stakeholders as the organizations that have a relationship with Atlas Copco in Peru. The stakeholders are everybody between suppliers to local authorities. The stakeholders of Atlas Copco play a central role because the largest influence of the company is the influence of the stakeholders. Menendez means that the board and the top management are listening to people in the surroundings and that the board in Sweden provides a lot of good recommendations concerning structure. One example is the recommendation to increase the number of female employees in the organization, which is an important recommendation for Atlas Copco Peru to take into account. Furthermore Menendez means that the company for example helps the suppliers to develop through cooperation.

One statement that Menendez made followed:

“To be able to have a sustainable business we have to work with the people because we are not here to make business today, we are here to maintain our operations for many years and we have to cooperate with the people outside the company to achieve that.”

The stakeholders can also push the company to work with specific areas within CSR, and Menendez says that they are always open for recommendations. Atlas Copco is cooperating with a Peruvian foundation called Fundales and also Andeas infantiles which is an organization performing social actions in the entire Latin America. According to Menendez the company is also working with their human resources department in Peru. Last year during Christmas Atlas Copco did send baskets with food to community centers for elderly as well as to different organizations that work with young people that has it tough economically. Menendez means that it is sometimes very complicated to work with non-‐governmental organizations because they are sometimes not performing to a hundred percent what they have promised. Therefore Atlas Copco has to be selective and sure about their choices that they cooperate with professionals. Menendez explains that Atlas Copco has guidelines and policies that they follow. Atlas Copco is a part of the United Nations Global compact policy.

Securitas has during the period of 2006-‐2008 developed different functions together with their stakeholders. The focus is put on specific actions to decrease the malnutrition in early childhood and to promote the integration of people with dysfunction to their organization. Mrs Muniz elaborated whom their different stakeholders and how they are involved and influenced by them. The primary stakeholders of Securitas are fostering the use of the code of conduct that exists within the Securitas group. They are also a part of the company reports and the sustainability of the global compact. The second stakeholder for Securitas is


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the customer where they try to integrate them in the social initiatives that they desire to implement all over Peru. Muniz told us that they have a quality management system (ISO 9001-‐2000) that consists of many parts that is beneficial for their customers; she mentioned that this includes both internal and external customers. Muniz said that they are trying to get their customers more involved in the social initiatives that Securitas has as well to generate more influence on their target groups. According to Muniz they have chosen their suppliers as their partners after making a strategic decision that has as a goal to create long-‐term business relationships, they create the relationships with their suppliers with clear and fair rules about the social responsibilities the company wants to implement in all of their stakeholder relationships.

The community in Lima where Securitas Peru is situated in is regarded as their stakeholder. They have tried to implement a comprised policy where they work together with the communities to benefit of the Peruvian community as well as the organization of Securitas. Muniz continued that the government, both regional and local, are their stakeholder where they try and have an institutional collaboration with different departments, the congress and will also be a part of anti-‐corruption actions. They have achieved these good relationships towards the government through placing it on strong leaders and influenced people within the business world. One example of the cooperation between Securitas and the government is that they have developed a program with the Minister for children and women to create social sustainability; the “Wawa wasi” is one of the projects that they have created with this authority. Muniz told us that a Wawa wasi is a kind of kindergarden where the children can stay during the day while the parents are working. The Wawa wasi is connected to the church, the local community and the local government that all contribute so that this can be possible to perform.

Their secondary stakeholder group is the media, NGO: s and universities both in Peru and in other parts of the world. They have tried to gain as much knowledge and expertise from these stakeholders as possible so that both Securitas and the stakeholders in the future can explore the training and implementation of socially responsible actions. The universities that Securitas are connected with are for example the University of Lima and The University of the Pacific. Muniz told us that they try to keep a close connection with all of their stakeholders to achieve their sustainability goals. She also said that obviously the stakeholder influence Securitas because they are a part of the action of CSR they want to implement. Muniz pointed out that to achieve the best results considering sustainability and social responsibility it is better to have many players involved such as NGO: s, communities and the government. However she also said that in Peru reliable NGO: s can be found for cooperation but difficulties can occur because it exists many unreliable organizations that only desire to earn money and not to actually contribute to a better society.


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Above: the stakeholders of Securitas:

Suppliers: A part of Securitas organization because they have excellent service and dedication and they choose them carefully and with conditions.

Shareholders: stands for the principals and ethics of the company as well as the corporation and transparency through the whole organization.

Community: Securitas strongly encourage the sustainable development within the communities’ through the association Securitas social responsibility.

Universities: Are human capital that are of great importance for the activities concerning CSR of the organization.

Environment: Securitas preserves the environment through their systematic action such as being a part of the (ISO 1400-‐2004). Collaborators: are using a system that helps to improve the security and health of their employees and their families (OHSAS 1800-‐1999).

Customers: Securitas has a as their prime goal to stand for quality (ISO 9001-‐2000), they try to have a close relationship towards their customers.

Government: Securitas have synergy with the ministry and local and regional governments through social campaigns and raising awareness of social issues.


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Mrs Perez Helden explained that the stakeholders of the company are the distributors in the Lima and Andean area. The students at the technical and engineering universities are SKF´s future customers and because of that reason it is important to maintain contact with them. According to Perez Helden SKF are working actively with a few NGO´s working with one or two campaigns. An example is the church they are starting up in Puno together with a NGO, because in that area most of the people are catholic. They also have cooperation’s with Fundales. Perez Helden believes that the stakeholders play an important role and that communication is the key. If SKF can communicate their message, they can change their way of acting and gain the awareness of the environmental problems and take these issues into consideration. As an example she states that last year two-‐three distributors helped SKF in tone of their projects and by communicating their message they can change, which is great because they have got the tools to do it. According to Mr Raul Aguila cooperation’s with non-‐governmental organizations are very complex. Some groups are trying to gain political power and are doing damage to the country. It is difficult to know who to trust and cooperate with.

4.4 Legitimacy There are three different types of legitimacy. Firstly are the practical actions of a company. Secondly is the company values and how they portrait themselves. Thirdly the stakeholder view of the companies’ actions. Mr Menendez stated that for Atlas Copco the most important of these three types of legitimacy gathering is the actual performance of the company. He pointed out that it is of great importance that the company is consistent with issues concerning social responsibilities over a long period of time. He said that it is vital to communicate their practical actions to their stakeholders. He said that showing practical proofs towards the society is important but most probably it is not their priority. It is more of the image that Atlas Copco wants to send out to their surrounding environment. He also said that externally they act on the guidelines that the Atlas Copco group ordering.

Mrs Muniz said that the most important way to gain legitimacy for Securitas is through the values of the company and in which way they portrait themselves towards society and their stakeholders. They have a code of conduct where they want to have transparency in all of their business activities including their social responsibilities. They believe that it is important to give the stakeholders and society access to information concerning their social responsibility area. Muniz also stressed the importance of having a dialogue with their surroundings’ in order to send out their message. She also said that the code of conduct and their model of sustainability are the ones that create the legitimacy.

Mrs Perez Helden believes that practical actions is related to the work she and SKF have organized; with that said she means that in first hand it is their own people and then their customers that are of importance. One crucial part that Perez Helden said was that she does not believe in the advertising of these sustainability practices, it is of course good to have publicity in these areas but is not the main reason for why they are having sustainability and CSR practices. She understands that it can be difficult to understand why a company would not want to reach out to the community and society that they are having social responsibility


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actions but it is because the budget that she receives from SKF is not enough for advertising on the contrary she believes more in investing in the actual projects rather than using that money into sending out a good view of SKF:

“For being good persons and good corporate citizens sooner or later people are going to be aware of what actions we are doing for society. I believe that we are acting in good manners and I would prefer and wait until people recognizes that”

She gave us an example, SKF made a video where they show the different projects they have and how they proceed with their sustainability work, she could have done a TV advertisement but she did not because it was too expensive instead she says that there are other actions you can do to reach out. The word of mouth is a useful tool for SKF to reach out with their CSR actions that is why the practical actions are the most relevant tool for SKF when trying to gain legitimacy.

4.4.1 How much corporate social responsibility should a company take?

To receive a wider range of understanding of the CSR concept we asked our interview objects; how much responsibility they believe they should take in society. We asked them this question in order to get a clear view of their own and the MNC`s or organization standpoint concerning the subject. Therefore we decided to incorporate this question into our empirical findings. Mr Menendez says that the cultural aspects, is of great importance we have to keep in mind, that employees has to be certain if this kind of problems occur for example inequalities at work or if there are social problems in the communities; we can cooperate and contribute to a better situation. He says that social responsibilities are more of an approach of implementing responsibility in the company and into the company culture so that everyone in the organization are aware of the standards and conditions that the company wants to portrait. He gives an example; there was an earthquake in Pisco, in the south of Peru, two and a half years ago and Atlas Copco contributed with food and materials for the people. In this situation the employees of Atlas Copco realized the importance of the communities and participated in the contribution.

Securitas states that the world is becoming more and more interconnected and because of the development of the technology and trade, companies have to take more responsibility for the market they are active in. Muniz believes that a company has a lot of responsibility towards their stakeholder and society. She said that Securitas has do adjust to the new global scene where investors, customers, suppliers and the society are having more demands on being socially responsible. Muniz believes that to be able to have sustainability on a market it is crucial to create relationships with their surrounding environment and to create social responsibility based on trust, commitment, solidarity and human development, which would benefit all. The primary reason for Securitas having CSR practices is not to only gain publicity but to actually contribute to the welfare and development of the areas where they are active on. She says that companies all over the world have an increasing responsibility towards human kind.


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SKF and Mrs Perez Helden believe that no matter size or turnover a company should be involved in CSR practices in one way or another. She said that it does not have to be extensive activities; it can be small initiatives that can contribute to the development. She gave examples of that the companies can get their personnel involved and make associations with people or organizations that have expertise within the field of CSR. She once again points out that no matter if you are a small or large organization everyone should set an example of social responsibility to increase sustainability.

Sandberg believes that companies should take responsibilities when establishing themselves on an emerging market, but he can not say to which extend they actually are taking responsibility in practice. He also said that taking responsibility both on the social and the environmental areas are crucial for a company, because taking responsibilities eases misunderstandings and problems that can occur when proceeding investment. He believes that companies should surround themselves by experts in the area of CSR considering agreements and commitments that has to be made.

4.5 Future Mr Menendez idea is for Atlas Copco to continue with their performances in the CSR area, but he admits they have to communicate their activities better, for example use technical magazines and reports as instruments to show people about their actions. Most importantly is to let the stockholders and society to know that they are working to maintain and improve the communication. Mr Menendez means that they can always improve and cooperate as much as they want to, it is not a question about money, and it is about their company image and the culture of the country. His responsibility is that they all within the company have the focus set on the same issues. Environment is important, and many companies are already working with the environmental issues and authorities have projects in the area. Mr Menendez is sure that CSR will pay off in the future, but means that the case is not to realize that it is important only for the world, but for the humanity. Mr Menendez continues that we are lucky people to have a family, an education and a good life, while other people do not have the same opportunities. We need to be responsible and work toward making people’s lives better, and not only look for new investments. Mr. Menendez states that Atlas Copco always has been a good example for the local companies and a good image in the country is necessary.

Mrs Muniz said that the future of CSR looks bright in the Latin American region overall, because it is being implemented in a wider range and more people are getting concerned of these issues. She also said that their clients and stakeholders demands social responsibilities from Securitas and they will keep developing their CSR and sustainability practices in the future. Having social responsibilities give you the opportunity to extend your values and gain more trust and commitment from society. Within the Securitas group the development of CSR practices is now entering a new era, because they are creating social responsibility departments all across Latin America.

According to Mrs Perez Helden SKF would in the future like to manage their CSR through sustained projects related to economic activities of communities and unprivileged people. They want to do more than making donations and want to initiate actions. These activities


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can be industrial actions, for example similar to those actions mining companies are developing in their areas where they involve the whole community in the surrounding in their CSR efforts. Perez Helden believes that companies have these responsibilities, but she is not sure if it will pay off or not. She adds that SKF see this like a commitment to the society rather than a marketing or publicity action it is a long way to go until we can talk about a fair society, but companies can work hard to change this. She continues that people all over the country of Peru should have the same opportunities for education and work. Private companies have the resources and personnel to take these actions and make them grow. The main CSR issue that should be more focused on in the future is education for children.

Raul Aguila is certain that in the future when western countries will invest in Peru, they should not trust outside organizations, but the environment around the organizations to make the society rise and on the contrary make money. They must think 20-‐30 years ahead constantly and the development of the country will slowly happen. Everything is connected, and every one chooses if they want to be a human that destroy the planet or someone who contribute to the development. For Raul the most important areas considering investors areas should be the health, education and the environment (in that order).

In the future the Nordic chamber of commerce will try to recognize new solutions to “help” companies to invest in societies on their own. Raul wants this to be implemented in the chamber of commerce in the future, and is trying to get everyone on the same page. Raul believes that companies should cooperate with the local governments because they understand the people’s needs more then the central government does and also be inspired by other countries ways. As an example Mr. Raul is telling us about his exclusive face-‐to-‐face meeting with the Brazilian president. He thinks that the Peruvian development and CSR would be of greater importance to the people if everyone got together as one and worked together even though everyone have different horizons. He is telling us about his meeting with the Brazilian president, that the president told him that one main reason for the boom in the Brazilian economy is connected with the people; that the Brazilian people are in his opinion united and the ethnic groups are not as divided as in for example the United States. For Peru to be able to go forward that is exactly what they need as well.

For Raul Aguila it is important to learn of other countries success stories and how the development goes. Peru should learn and be inspired of other countries for the development to go forward and the CSR will be progressed as well. He said that they would not only establish closer relationship in the private sector but also within the areas of economical a social development.

Sandberg believes that CSR is a question that is becoming more and more enlightened, and the responsibility a company has is not only in the developing country of operation, but everywhere on the earth. It is of importance to be one step ahead to prevent misunderstandings and uncertainties. The question is getting more authorized and the state is often a bit behind in many current questions, that makes it easier for the companies to get away with corruption and bureaucracy, a subject that is not easy for the authorities to solve.


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5. Analysis In this chapter we will present our gatherings by binding our theoretical framework with our empirical findings in order to answer and analyze our formulated questions.

5.1 The CSR concept The CSR movement is for some organizations a relatively new phenomenon and for others a well-‐used concept, to a certain degree depending on the country of operation. The difficulties in the lack of a common excepted concept describing what CSR really mean are the different points of views concerning the subject. Even though CSR was stated for the first time in 1953 by the Economist Howard R Bowen, many of today’s MNC`s are just now implementing the different actions (International Business Ethics 2008). This is the case of the companies studied. Jansson (2007), Porter (2006) and Ellerup & Thomsenn (2009) all agree that CSR is a competitive advantage. Even though it is hard to point out the large advantages in CSR actions, Securitas, one of the MNC`s of our thesis, were certain that this shows off a positive effect and at the same time benefits society. The fact that all of the MNC`s and organizations we have been studying in one way or another, more or less are implementing CSR actions in their organizations means that the CSR movement in Peru is increasing. On the contrary the overall CSR investments on the Peruvian market are very small, due to other priorities All the MNC`s are large Swedish enterprises and have outside pressure and responsibilities compared to the domestic Peruvian companies. Swedish companies are following restrictions and certain standards in Sweden and partially must apply those standards even in emerging markets like Peru (www.csr-‐weltweit.de). Due to the fact that Peru is an emerging country, international organizations have a significant part of the CSR actions (German Embassy, Lima). This is clearly shown in all of the interviewed MNC`s; they all interact and cooperate with international organization in order to implement the CSR actions further. Criticism on the other hand, issued by the most prominent Friedman (1970); only people could have obligations, not businesses, and in his believes a company just has responsibilities towards their employees and shareholders.

5.2 CSR practice of the firms

-‐ How do Swedish MNC´s work with corporate social responsibility in an emerging market?

We have witnessed that all MNc`s of interest has in one way or another implemented CSR actions, some companies more distinct then others. The CSR practices are divided into two main groups, which are the internal and external branches.


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5.2.1 Internal CSR

Internal CSR is related to incentives that influence the employees and the internal environment of the company. In an industrialized country like Sweden most of the dimensions such as job safety and development are more obvious; while like in an emerging country as Peru it is not as clear (Baumgartner & Ebner 2010). One example that we found very definite was the interaction Securitas had concerning their employees. Every quarter of a year they had a ceremony where the top management rewarded employees for their extraordinary work. This is a way to show appreciation and create a sense of trust among the employees.

A bad word of mouth in an industrialized country like Sweden now when social media are so widely used can be devastating; companies cannot afford not to have internal CSR because it can ruin a company. Internal CSR is the more invisible part of CSR actions and does not show a huge difference on society while CSR overall is a connection between business development and social enhancement.

5.2.2 External CSR

The External part of the CSR movement is in general the core of CSR because it affects more then just the employees it affects people in whole. External CSR are factors that externally affect the company’s way of doing business, the interaction with the surrounding society and cooperation with their stakeholders (Ebner & Baumngartner 2010).

The external CSR communicate ethical behavior and human rights as an important part of the agenda. Human rights consist of treating and respecting the human. One very clear example of this is the project that Securitas is implementing; to integrate disabled people into their organization.

To have no controversial activities as the second dimension implies is a specifically fragile question for Atlas Copco and SKF due to the fact that these are industrial companies that has to in one way or another exploit the natural resources of the local community. Therefore these two companies understand the importance of integrating the local community and get along with them in order to avoid problems such as bad publicity and strikes. This is even more important for the fact that as (Pedersen 2006) stated; our world is becoming more and more global and in the dynamic and complex information spreading society we are living in, companies have to act more ethical then ever.

5.2.3 Corruption

All of these dimensions are much more difficult to maintain in less developed countries in the absence of institutions and developed society. Therefore it is a major challenge to correctly implement these actions in a society where corruption is established. All of the studied MNC`s have expressed a huge problem with the corruption not only in their


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everyday business activities but also concerning cooperation with legitimate organizations’ in their CSR practices. For example Mr. Auguila gave the advice that companies wishing to invest or integrate outside organizations into their CSR actions should make a careful evaluation in order to find a reliable partner to work with; due to the fact that it is in a lot of cases a political game not organization’s that work for the common good. When analyzing the external dimension of corruption, it is very clear that the corruption is so widespread in Peru that this can create a discouraging view for companies to implement CSR actions into the business strategy because they do not trust the system they are active in, causing negative domino effects and mistrust. These types of problems occur in a society like Peru where CSR is needed the most for the sake of social and economic development.

5.3 External stakeholder influence

How do external stakeholders in the emerging market influence the CSR involvement of the Swedish MNC´s?

The external stakeholder influence is huge concerning all of the MNC´s, and as Pedersen (2006) stated: “The stakeholder theory is a common reference used when integrating CSR-‐actions”. Stakeholders can be divided into two different groups, which are the primary and secondary stakeholders. The first group has a direct impact on the companies’ way of operating, while the secondary is an effect of their businesses indirectly.

The difficulties when using the stakeholder theory as a common ground is that many businessmen claim that business is business and the moral dilemmas that can occur should not be taken into consideration, though Phillips (2003) claimed that this issue is a moral obstacle; should the company take their surrounding environment into consideration or should they just focus on profits. Concerning an emerging market like Peru these moral obstacles becomes even more blurry due to the well-‐established corruption and the MNC`s are forced to rely on outside organizations and primary stakeholders.

When analyzing our empirical findings, all of the studied MNC´s have a widely spread interaction with both their primary and secondary stakeholders. The reason is that they all acknowledge the importance of having cooperation with their surrounding environment in order to be successful in their CSR commitment. One example of this is the statement of Vokbus & Ståhl (2009) that sustainability means interaction with their stakeholders, in the case of the studied MNC´s of this thesis it is even more crucial in order to be successful.

5.3.1 Primary stakeholders

Examples of primary stakeholder are shareholders, employees, customers and suppliers. For Atlas Copco their internal CSR and primary stakeholder are the ones that the try to improve their relationship with the most. They implement employee policies that are set as standards from the Swedish board and are also trying to implement equality standards, where the progress in the area in Sweden is much further ahead than in Peru. An example of this is that Mr. Menendez pointed out the value of the advice the Swedish board minister with concerning internal structure and how to improve their primary stakeholder influence. Therefore integrating a good corporate communication as Pedersen (2006) and Ellerup


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Thomsenn (2009) stated, is crucial where international companies such as Atlas Copco are expanding and penetrating emerging markets.

For Securitas and Mrs Muniz the primary stakeholders are a way to communicate and integrate their customers for example in their social incentives. She believed that in order of doing so they would benefit within their target groups, and gain a competitive advantage. As Jansson (2007) said having social initiatives, as a part of the companies’ business strategy is a great way of gaining both legitimacy and competitive advantage, therefore in our opinion the action of Securitas; wanting to integrate their customers is a very wise choice. Suppliers of Securitas are well aware of the rules that Securitas have in order to make business with them. All of the studied MNC`s have implemented conditions and using tools such as the ISO and global compact policies in order to have a clear understanding among their primary stakeholders. Where the demand of customers, suppliers, owners etc. are increasing Mrs Perez Helden claimed that the relationship with their primary stakeholders is their opportunity to learn what the market is demanding and therefore improve both the internal obstacles and also know what is demanded to communicate outwards.

5.3.2 Secondary stakeholders

All of the studied organizations are international established and well-‐known cooperation’s around the globe. Therefore they have primary stakeholder standards built up from the headquarters. Due to this the secondary are more vital when operating in a emerging market like Peru. Secondary stakeholder consists of; NGO`s, media and both national and regional governments. Conducting our thesis we found that most of the questions both positive and negative issues considering secondary stakeholders are the focus for all of our studied MNC`s; that’s why companies are implementing different legal obligations to improve for example work conditions and environmental concerns Holmstedt et al (2009).

All of our interview objects expressed the difficulties operating with outside organizations or government; due to the fact that Peru has extended corruption. It makes it hard to find a reliable partner. Securitas has shown the highest degree of commitment concerning integrating secondary stakeholders into their CSR program. As Mrs Muniz told us they work with four different projects throughout the country with the aim of contribute to the society they are active in. A secondary stakeholder that Mrs Muniz found very important were the universities; to communicate towards universities all over the world gives great reputation and word of mouth. Both for their actions and as an attractive employer; once again an evidence of wanting to gain competitive advantage Jansson (2007) by using employer branding in their secondary stakeholder actions.

Both Atlas Copco and SKF are working with the non-‐governmental organization Fundales while Securitas prefer to associate themselves with smaller organizations that they have a closer connection with. All the companies have cooperation’s with the church, which we conclude is because the church has a major influence in the Peruvian society, and is regarded more reliable then NGO´s in average. If the MNC:s integrate themselves more with their stakeholders they will not only achieve a closer relationship with them but also connect themselves to all involved parties within their business.


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5.4 Legitimacy -‐ How do the Swedish MNC´s get legitimacy from the society and their surrounding environment in the emerging market?

Legitimacy is something that all of our MNC´s wants to gain in order to achieve their CSR goals and also to get the trust, commitment and consent with their surrounding environment. Gaining legitimacy is very complex, due to the human beings different preferences of what legitimacy actually is and how to gain it. Too successfully gain legitimacy in society takes a lot of trust and therefore it is larger obstacle in a country like Peru where the corruption level is high and the institutions are weak.

As stated there are three different types of legitimacy

• Practical actions of a company • The company values and how the portrait themselves • The stakeholder’s view of the company’s actions (Vokbus & Ståhl (2009).

All of the studied companies are integrating the different types of legitimacy required to be trustworthy. We can see that they all are using their communication channels such as, magazines, events and advertising; all of these used as a marketing tool.

Securitas, Atlas Copco and SKF are all focusing in different degrees in the social area, which according to the triple bottom line is one part that has to be involved in the development of business, and are making contributions in different ways within the area Elkington (1989). They are cooperating with outside organizations in order to achieve further sustainability and legitimacy even though their approach differs. According to Carrols pyramid companies have four different responsibilities in order to achieve sustainability and legitimacy. The last responsibility, which is the philanthropic responsibility, is optional for companies to implement, but in the way social awareness is becoming more implemented around the globe we believe that in the future companies will be more or less forced to take philanthropic responsibility in order to be sustainable on a market Carrol (1991). Jansson (2007) describes that having social responsibility can serve as a positive impact on a company’s competitive advantage. We agree because wanting to gain legitimacy on a market does not only benefit companies outwards the society but gives them a competitive edge in comparison to their competitors.

It is important for companies to be associated with people with a lot of experience in the subject in order to receive legitimacy from their surrounding environment. It is a strategic decision whom they are cooperating with or image and reputation could go down the drain. This is once again strengthen by Sandberg who also believes that in order to achieve good CSR practice companies have to be surrounded by people that have expertise in the area.


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The MNC: s we have studied have two different views of how to best gain legitimacy. Securitas believes that they will gain more legitimacy through their values and how their stakeholders view them, which can be connected with the statement from Vokbus & Stål (2009) that says that wanting to have sustainability is achieved by having an interaction between the company and their surrounding environment. Atlas Copco and SKF believe that the practical actions of the company are of greater importance concerning legitimacy. We believe for companies acting on the Peruvian market where the trust on companies is fairly low, the MNC:s should concentrate more on their practical actions in order to gain legitimacy from the society because the society can observe what companies actually are doing concerning CSR and not only what they say they will do. This will create a more positive outcome both for the companies and for the affected people.


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6. Conclusion In this chapter we are presenting our conclusions made from our analysis and will continue with future recommendations in the subject. This allows us to conclude the gathered information in order to empower our formulation of question.

Progress is made within the CSR concept and is on a front march in Latin America. On the contrary it is not implemented in a greater extent. In order to understand CSR, both from a organizational and societal perspective it is of importance to be aware of company’s role when being a global actor. Organizations need to understand that in order to be sustainable they have to think in a long-‐term perspective. After conducting our field study we can conclude that our entire interview objects express the necessity of both internal and external CSR.

6.1 CSR The CSR movement within our interview objects is partially implemented and provides them tools to enlarge the operations. As mentioned before the CSR practices can be divided into two branches’; the internal and external. Due the fact that our studied MNC: s are Swedish, well established corporations, the internal dimension of CSR is already consolidated with thought of the long presence. Therefore the focus should lie on enhancing the external dimension and incorporating the practices throughout the organization. The MNCs of interest are all implementing more external CSR actions and are well aware of its importance. Securitas, SKF and Atlas Copco are all involved in CSR practices though Securitas are the most devoted. When they are teaching a mother to knit or a child about principles and values it is not only those taught who will be affected. The whole family benefits from this to be able to live a more descent life, which in return creates a circle from company profits to society enhancing the welfare of an emerging market.

To have been given the opportunity to perform a field study and be a part of one of Securitas projects gave us a great understanding of how external CSR actions actually works and how the largest resources needed is commitment and motivation. This was clearly reflected through Gina Muniz whom showed an excellent engagement, which created an good corporate communication in the organization. Atlas Copco and SKF are also involved in CSR actions; both are working with external organizations in order to implement their CSR framework. They are more careful and cautious of the reason that they work with outside organizations that can be corrupted, while Securitas has chosen to have most of their CSR actions in-‐house. Therefore we see a huge potential for Atlas Copco and SKF to keep implementing and enhancing their external CSR practices throughout the country.


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6.2 Stakeholders There are primary and secondary stakeholders that need to be taken into consideration. In order to be successful long-‐term our interview objects have to think sustainability. All of the MNC:s understand the huge importance of integrating and cooperating with their stakeholders because in today’s world it is demanded form both parties. It is not only because the company receives goodwill and positive publicity it also gives an opportunity to develop together with their stakeholders, if they do not take the stakeholders into consideration the will not only loose market shares but legitimacy as well. All of the MNC: s agree with whom their stakeholders are and which approach they should have towards them. They also have a clear understanding of how and to which extend they want to integrate them to their overall business strategy and specifically in their CSR commitment.

We believe that all the companies have got a good dialogue with their stakeholders, and we are a great example of this, a couple of university students that are welcome to get an insight of their work. This is benefiting the companies in the way that they get publicity in interacting with their stakeholders, also do they get employer branding, to be a attractive employer is vital for the companies progress.

The corruption is extremely high in Peru, which makes the stakeholder relations harder than in other markets, when it’s a question of loyalty and trust. For example, the companies have a set of regulations how they ought to work towards their stakeholders, but it can be harder to obtain because of the corruption that is deeply spread in the country. If more companies are arising these issues and start to develop their CSR actions, we conclude that this could reduce corruption in a longer perspective distinguishable, because it is a part of the wheel that connects the socio-‐economical environment and creates sustainability.

6.3 Legitimacy Gaining legitimacy on a market is crucial, especially concerning the CSR movement. A company that has implemented CSR actions into their organizations wants to gain and sustain the surrounding environments trust and commitment. On the other hand legitimacy is the hardest part of the CSR because legitimacy is different depending who you ask. Therefore our companies have made a strategic decision in how they want to gain legitimacy on the market. For Atlas Copco and SKF the practical actions are the path they have chosen. We believe that this is a strategically good choice because the trust among the society is very low towards companies and therefore it is better to actually act right here, right now. In order for people, organization and institutions to feel loyalty and commitment they need to see actions now and not tomorrow.

Securitas is the most outstanding company concerning legitimacy according to us. They are working with their employees continuously concerning the CSR issues and have the most outwards connection with society and therefore the word of mouth in for example different villages where their guards live creates a sense of trust, presence and a image that is hard to achieve if you are not truly committed. It has proven that if you are acting, as a good corporate citizen it will ease the implementation of further CSR actions, in other words more


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of the effort concerning legitimacy must be done in the beginning of the CSR incorporation. We conclude that if our companies want to be sustainable concerning legitimacy in a long-‐term view the core must transparency.

As well as legitimacy brings transparency it also comes with vulnerability. If the surrounding environment of the corporations suspects that they has not acted accordingly to the legitimacy they want to portrait, it can make them not only loosing trust and commitment but also in the longer run making it hard for the company to do business in the region; causing strikes and riots for example.

Shown in study Securitas and Atlas Copco are certain that CSR will pay off in the future, while SKF are more skeptical. The fact that all of the MNC´s right now have CSR or sustainability practices shows that they believe that it is an issue that needs to be raised and also that it can be beneficial and provide a good image. The fact that the Nordic Chamber of Commerce has been established a year ago means that the development is in the right direction for future progress in the CSR area. They will be able to guide companies in the right direction and give practical advices concerning a potential establishment in Peru. Also, Sandberg mentioned it is a sign that something is happening in the Peruvian market because the fact that the Swedish Trade Council are on their way to establish in Peru.

On the other hand we do not know what the future brings. So far we do not know the real effect of CSR actions, people who are affected or not affected and if the concept really is workable or not, for one side, for two or more, direct or indirect. How this could change the social development, if it does, we can only speculate with the information and the observations others and we have made in the area. Maybe is CSR just a trend that will vanish in a few years’ time, something that the market demand for now, but probably not. The future will tell if CSR will be integrated further in the MNC´s, also if it is crucial for the social development and important for protection of the earth, in today’s world where the environment and the future for all living is decided. Everyone should take their responsibility, and the best effect for change lies on the corporations to lead the way. As Mr. Aguila states; we are not here to do business today, we are here to do business for many years ahead.


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6.4 Recommendations Our recommendations are made from our concluded study for present and future excecution. Firstly an organization has to receive an insight in what kind of CSR actions they want to integrate within the organization; how they want to do it and to which extend. Thereafter they have to clearly communicate it in the organization.

o The company must be aware of that CSR can demand a lot of work and time

and be willing to take a risk. The outcome of these actions will create long-‐sightedness. The sort of actions and/or organizations desired to associate with must be carefully reviewed, for ability to pick the most suitable alternative.

o Thereafter the company must search for people with expertise in the area

that are serious, reliable and can represent the company values. Specifically in an emerging market where the corruption is widespread.

o The company must be certain about their cooperation partners’ motives for

their contribution in the area as well as their own motives and goals, and from the very beginning clearly communicate these.

o The organizations have three alternatives; 1. To work with outside organizations 2. To implement it In-‐house, 3. To mix the two

o After conducting our field study our recommendation from our own experiences is that a company should mostly implement and develop In-‐house CSR because it is easier to get people involved, motivated and engaged in projects and actions that are tangible. This provides the employees with non-‐monetary benefits that are essential for the individual as well as its is pushing the company forward.

We believe that to integrate CSR in the organizations business strategy, is not only a strategic choice for growth, it can also be a vital step in the future existence. It can be a risk to involve CSR only in some financial perspectives, but we are certain it can be a larger risk not to because of the demands in the today’s more and more environment-‐conscious business world.


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Reference list Literature Bryman, Alan & Bell, Emma (2005). Företagsekonomiska forskningsmetoder. 1. uppl. Malmö: Liber ekonomi Deegan, Craig. (red.) (2002). Accounting, auditing & accountability journal [Elektronisk resurs] Vol. 15, No. 3, Social and environmental reporting and its role in maintaining or creating organizational legitimacy. Bradford, England: Emerald Group Publishing Kotler, Philip & Lee, Nancy (2005). Corporate social responsibility: doing the most good for your company and your cause. Hoboken, N.J.: Wiley Jansson, Hans (2007). International business marketing in emerging country markets: the third wave of internationalization of firms. Cheltenham: Edward Elgar Merriam, Sharan B. (2005). Fallstudien som forskningsmetod. Lund: Studentlitteratur Patel, Runa & Davidson, Bo (2003). Forskningsmetodikens grunder: att planera, genomföra och rapportera en undersökning. 3., [uppdaterade] uppl. Lund: Studentlitteratur Phillips, Robert (2003). Stakeholder theory and organizational ethics. San Francisco, Calif.: Berrett-‐Koehler Sims, Ronald R. (2003). Ethics and corporate social responsibility: why giants fall. Westport, Conn., Praeger Stake, Robert E. (1995). The art of case study research. Thousand Oaks, Calif.: Sage

Scientific articles & essays Aguero, Felipe(2004). Globalization, Business, and Politics: Promoting Corporate Social Responsibility in Latin America Paper presented at the annual meeting of the International Studies Association, Le Centre Sheraton Hotel, Montreal, Quebec, Canada, Mars 17, 2004 Baumgartner, J. Rupert & Ebner, Daniela (2010). Sustainability Strategies: Sustainability Profiles and Maturity Levels (Electronic). Sustainable Development Sust. Dev. 18, 76–89 (2010) Available: Interscience Wiley (2010-‐04-‐12) Carroll, Archie B (1991). The Pyramid of Corporate Social Responsibility: Toward the Moral Management of Organizational Stakeholders. Business Horizons July/August, ss. 39-‐48.


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Cederholm, Frida & Rebecca Svensson (2009). CSR i plast och kemi branschen, sektionen for hälsa, samhälle och ekonomi, Högskolan Kristianstad Cederholm, Frida & Rebecca Svensson (2009). CSR i plast och kemi branschen, sektionen for hälsa, samhälle och ekonomi, Högskolan Kristianstad Quotes Deegan, Craig. (red.) (2002). Accounting, auditing & accountability journal [Elektronisk resurs] Vol. 15, No. 3, Social and environmental reporting and its role in maintaining or creating organizational legitimacy. Bradford, England: Emerald Group Publishing Cederholm, Frida & Rebecca Svensson (2009). CSR i plast och kemi branschen, sektionen for hälsa, samhälle och ekonomi, Högskolan Kristianstad Quotes :De Geer, Hans & Trollestad, Claes (2009). Etik i arbetsliv och affärer.Kristianstad: Författarna och SNS Förlag. Cederholm, Frida & Rebecca Svensson (2009). CSR i plast och kemi branschen, sektionen for hälsa, samhälle och ekonomi, Högskolan Kristianstad Quotes Grankvist, Per (2009). CSR i praktiken – hur företaget kan jobba med hållbarhet för att tjäna pengar. Malmö: Liber AB. Dubois, Anna & Gadde, Erik (2002). Systematic combining: an abductive approach to case research. Journal of business research 55 (2002) 553-‐560 Ellerup Nielsen, Anne & Thomsenn,Christa (2009). Investigating CSR communication In SMEs: a case study among Danish middle managers (Electronic).Business Ethics: A European Review Volume 18 Number 1 January 2009 Haslam, Paul Alexander (2004). The Corporate Social Responsibility System in Latin America and the Caribbean. Focal policy paper Holmstedt, Emmi, Liron Andersson, Mikaela & Sörensen, Sofia (2009) Det svenska CSR-‐landskapet. Lunds Universitet quotes Fassin, Yves. 2009. The Stakeholder Model Refined. Journal of Business Ethics. Vol 84, nr 1, sid 113-‐135. Kolk, Ans & Van Tulder, Rob (2010).International business, corporate social responsibility and sustainable development. International Business Review 19 (2010) 119–125

Friedman, Milton (September 13, 1970). The New York Times Magazine, Copyright @ 1970 by The New York Times Company.

Songbai Liu & Lu Liu (2009). IMPLEMENTING CORPORATE EXTERNAL SOCIAL RESPONSIBILITY STRATEGIES THROUGH ORGANIZATIONAL DESIGN AND OPERATION. 79Journal of International Business EthicsVol.2 No.1 2009. MBA Education Center, Beijing Normal University, Beijing, China


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Pareja Sedano, Luis Ricardo (2009). Responsabilidad social empresarial: Un caso en la minería Peruana. Universidad National Mayor de San Marcos, August 2009 Pedersen, Esben Rahbek (2006).Making Corporate Social Responsibility (CSR) Operable: How Companies Translate Stakeholder Dialogue into Practice (Electronic). Business and Society Review 111:2, 137–163 Porter Michael & Mark E Kramer, (2006), Strategy and Society (electronic) Harvard Business Review Rowe, James (2005). Corporate social responsibility as a business strategy: University of California, Santa Cruz Vokbus, Marina & Stål, Magdalena (2009) Uppförandekoder -‐ En studie i hur tre företag arbetar med etiska riktlinjer. Mälardalens Högskola quotes Grafström, M., Göthberg, P. & Windell, K. (2008). CSR: Företagsansvar i förändring.Malmö: Liber AB. Vokbus, Marina & Stål, Magdalena (2009) Uppförandekoder -‐ En studie i hur tre företag arbetar med etiska riktlinjer. Mälardalens Högskola quotes Moir, L. (2001). What do we mean by corporate social responsibility? Corporate Governance, 1(2), 16-‐22. S. Prakash Sethi – (2003) -‐ Business & Economics -‐ 306 sidor Oxfamamerixa Organization (2008). Corporate Social Responsibility in the mining industry in Peru ( Electronic). Oxfam International. Figure 1: http://www.istheory.yorku.ca/stakeholdertheory.htm (2010-‐05-‐01) Figure 2: Carroll, Archie B (1991). The Pyramid of Corporate Social Responsibility: Toward the Moral Management of Organizational Stakeholders. Business Horizons July/August, ss. 39-‐48. Web sources Corporate watch home page: www.corporatewatch.org (2010-‐11-‐28)

http://www.corporatewatch.org/?lid=2688 http://www.corporatewatch.org/?lid=2688

Global compact webpage: www.globalcompact.org (2010-‐04-‐22) http://www.unglobalcompact.org/docs/news_events/8.1/GC_brochure_FINAL.pdf“


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CCSENET: s webpage: www.ccsenet.org (2010-‐05-‐12) http://www.ccsenet.org/journal/index.php/ijbm/article/view/2733/2528 Securitas home page: www.securitas .com (2010-‐05-‐10) http://www.securitas.com/en/About-‐Securitas/ German embassy webpage: weltweit.de (2012-‐02-‐22) http://www.csr-‐weltweit.de/en/laenderprofile/profil/peru/index.nc.html SKF: s home page: www.skf.com (2010-‐04-‐23) http://www.skf.com/portal/skf/home/about Suites home page: www.suite101-‐com (2010-‐11-‐15) (http://www.suite101.com/content/criticisms-‐of-‐corporate-‐social-‐responsibility-‐a215932) Atlas Copco:s home page: www.atlascopco.com (2010-‐05-‐17) http://www.atlascopco.com/us/AtlasCopcogroup/ACinsummary/Factsandfigures/index.asp

Mallenbaker.net: 2012-‐01-‐10) http://www.mallenbaker.net/csr/definition.php (2012-‐01-‐10) Apec organizations webpage: www.apec.org (2012-‐02-‐22) http://www.apec.org/About-‐Us/About-‐APEC/Achievements-‐and Benefits/~/media/ABE4574794E248F98AFFABCB89BF0FBB.ashx SFGs webpage: www.sfg.se (2012-‐02-‐23) http://www.efg.se/pdf/SE/EFG_CSR_Policy_SE.pdf


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Attachment

Interview guide

1. CSR history and background 2. How long have you been active on the Peruvian market? 3. How do you define CSR? 4. How do you work with CSR? 5. For how long have you had CSR Practices? 6. How does your CSR apartment look like? 7. What is the main reason for your CSR? 8. What are the areas of greater importance? 9. Why do you believe that your company is good corporate citizens on the Peruvian

market?

10. Ethical principals 11. Do you follow any Policies? 12. Do you have own internal principals?

13. The impact of the stakeholders 14. Who are your stakeholders? 15. What role do they play? 16. Do you get influenced by them? 17. Can the stakeholders push you to work with specific area in CSR? 18. How is your company influenced by its stakeholders? 19. Do you have any cooperation’s with outside organizations?

20. Legitimacy 21. Do you have a code of conduct? 22. Does your way of doing things interfere with the per van way of doing things? 23. To what extent in CSR do you believe that companies should take? 24. How is CSR in Peru in comparison to industrialized countries? 25. There are three different types of legitimacy;

1. Practical actions 2. through their values 3. The stakeholders view of the companies actions

26. Which one do you think is most important?

27. Future 28. The next step that should be made for your company concerning CSR in Peru? 29. How would you in your opinion the ideal CSR elaboration in Peru look like? 30. Do you think that CSR will pay off in the future?


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Name of the project Niño’s Socialmente Responsables

Unit executive Securitas Peru and Asoc. Securitas Peru Securitas North Securitas Centre Securitas south

Localisation -‐ Lima -‐

Duration of project The program lasts four years and now plans to expand another 4 years

Sector Community and human development

Resume of the project

"Socially Responsible Children" is a program that aims to: promote more sustainable human development of girls, children, family and community, through its four projects (Health, Education, Employment and Citizenship), framed in the four areas of human development as required by United Nations Development Programme (UNDP). The projects, based on the Program of UNDP, are: Education Project: "Droplets Responsible" / Health Project: Cultivating My Children "/ Employment Project:" Creating Wellness "/ Citizenship Project:" I am also Peruano

The general objective Improving Human Development of Children of the Community of Villa Libertad through Sustainable Development Projects

The objective

Create favourable conditions for improving overall health (general medicine, medical check-‐ups, vaccinations, healthy breakfast) • Promote a culture of values and principles with the only course to strengthen their overall growth and school performance. • Promote and facilitate production workshops of the Mothers of Villa Libertad to generate income for the benefit of their children. • Strengthen the civic culture, participation, accountability and local identity Direct Niña’s y Niño’s de Villa Libertad

children 85

Indirect Madres de Villa Libertad Beneficiaries

Mothers 50

Conditions improving the overall health of girls and children of Villa Libertad (general medical check-‐ups, vaccinations, healthy breakfast.) • Increasing a culture of values and principles to strengthen its overall growth and school performance. • Development and production workshops promoting the Mothers of Villa Libertad to generate income for the benefit of their children.


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• Further strengthening of civic culture, participation, accountability and local identity.


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Linnaeus University – a firm focus on quality and competence On 1 January 2010 Växjö University and the University of Kalmar merged to form Linnaeus University. This new university is the product of a will to improve the quality, enhance the appeal and boost the development potential of teaching and research, at the same time as it plays a prominent role in working closely together with local society. Linnaeus University offers an attractive knowledge environment characterised by high quality and a competitive portfolio of skills. Linnaeus University is a modern, international university with the emphasis on the desire for knowledge, creative thinking and practical innovations. For us, the focus is on proximity to our students, but also on the world around us and the future ahead.

Linnæus University SE-‐391 82 Kalmar/SE-‐351 95 Växjö Telephone +46 772-‐28 80 0

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