Key Corporate Social Responsibility Initiatives: An Empirical Evidence from Spain

Abstract

Although 43 % of Spanish enterprises consider CSR to be valuable to their organizations, only 15.5 % systematically implement Social Responsibility initiatives (Forética (2011). The evolution of social responsibility among Spanish business.).

In light of this low level of implementation, the aim of this paper is to explore key CSR initiatives implemented by Spanish enterprises and their evolution over the last years. Previous literature has focused on the empirical analyses about CSR initiatives in a specific group of organizations, according to their size or their profit or nonprofit purpose. Therefore, the main contribution of this research is to advance in knowledge about the implementation of CSR initiatives in Spain conducting an exploratory analysis and focusing on three main groups of organizations: small and medium sized enterprises (SMEs), companies listed on the Madrid Stock Exchange and included on the IBEX35 index, and Non-Governmental Organizations (NGOs). Taking into account the differences between the three groups, this paper seeks to show whether these organizations are dealing with the same CSR initiatives, which of them are the most and which are the least implemented and how CSR policies should be orientated to promote CSR initiatives.

Our results show that most initiatives are focused on working conditions or environmental protection. Employees’ health and safety programs, plans for environmental protection and for energy efficiency, and gender equality and work-life balance, constitute the most common practices among Spanish companies (generally implemented by 60 % of companies). However, there are also initiatives undertaken less frequently (less than 15 % of companies), such as monitoring CSR in the supply chain, elaborating codes of conduct, and drafting CSR reports.

Focusing on Spanish enterprises listed on the IBEX35, we were able to discover how Spanish companies have enjoyed the greatest increases in environmental performance, social performance and corporate governance performance scores since 2002, as compared with the major other economies in Europe (such as the UK, France and Germany) using the Datastream database.

As far as NGOs are concerned, although most of them comply with most of the principles of the Lealtad Foundation Guide, a significant number of NGOs does not fully comply with the principles regarding the governance of the organization, plurality in financing and monitoring the use of funds.

In conclusion, results from this exploratory study show that, despite the great effort to implement CSR initiatives in Spanish companies and the increase in such initiatives, there are still some challenges to face, such as the efficiency of Corporate Governance policies and the difficulties small enterprises face when implementing these initiatives.

Annex 4.1. Principles of the Lealtad Foundation ’s Guide of Transparency and Good Practices

Principle		Subprinciple
1	Operation and regulation of the governing body	A	The governing body shall consist of a minimum of 5 members
		B	The governing body shall meet at least 2 times a year, with more than 50 % of the members of the governing body attending physically or by videoconference
		C	All members of the governing body attend, in person or by videoconference, at least one meeting a year
		D	Regarding members of the governing body, their names, professions, public office and kinship, and affinity with other members of the governing body and the management team of the organization shall be made public. The curriculum vitae of the members of the management team shall be made public. The organization will publish the relationships that exist between members of the governing body and the suppliers and co-organizers of the activity
		E	Only a limited number of members of the governing body may receive income of any kind, coming from both the specific organization and other related entities. This percentage will be less than 40 % of the members
		F	The membership of the governing body shall be renewed on a regular basis
		G	There will be mechanisms approved by the governing body to prevent conflicts of interest within the governing body mechanisms. These mechanisms will be made public
2	Clarity and advertising of the social end	A	The social order is well defined. It must identify its field of activity and the public to which it is addressed
		B	All activities undertaken by the organization will aim at achieving the social order, so that the organization does not carry out activities that are not explicitly covered in the Statutes
		C	The social order will be known by all members of the organization, including volunteers, and will be easily accessible to the public
3	Planning and monitoring the activity	A	There will be a strategic plan or an annual plan that encompasses the entire organization with quantifiable objectives, schedules, and responsibilities. Objectives related to the project area shall be made public
		B	Planning will need to be approved by the governing body
		C	Over the past 3 years programs have followed a specific line of work
		D	They will have formally defined systems for the control and internal monitoring of activities and beneficiaries. These will be approved by the governing body
		E	The organization shall prepare monitoring and final reports in support of projects, which will be available to funders
		F	The organization will have criteria and a project selection processes and counterparties approved by the governing body
4	Communication and faithful image of information	A	Advertising campaigns, fundraising and public information, will faithfully reflect the objectives and the reality of the organization. Furthermore, they will not mislead
		B	At least once a year donors and partners will be informed about the organization’s activities
		C	To communicate effectively, an e-mail address and a working website is required, with information on all activities of the organization and it must be updated at least once a year
		D	The organization will make available, upon request, the annual report of activities and the annual financial report. The annual activity report and financial statements with the corresponding audit report will be accessible through the website
5	Transparency in funding	A	The tasks of capturing private and public funds, costs and annual revenue (donations, partners, and other contributions), will be made public
		B	Details on the funds of the major funders, both public and private, shall be made public, and the amounts contributed by them
		C	The allocation of proceeds to the activity each year, properly documented, will be known
		D	If personal data are requested, the organization shall include the relevant information for the current legislation on personal data through its data collection means. The organization has registered its files of partners and individual donors in the Data Protection Agency
		E	There will be selection criteria for companies and collaborators approved by the governing body
		F	The agreements for the transfer of the company logo to companies and institutions must be formalized in writing. The clauses of logo transfer will not be confidential
6	Plurality in financing	A	The organization should diversify its funding from public and private funds. In any case, private income will be less than 10 % of total revenues
		B	The organization will have a variety of external financiers favouring the continuity of the business. None of them shall provide more than 50 % of total revenues of the organization continuously for the past 2 years
7	Fund usage oversight	A	The distribution of operating costs grouped in the categories of Fundraising, Activity-Programs and Administration-Management, will be known. The use of funds, broken down by each project and activity line of the organization, will also be known
		B	There will be a breakdown of the main suppliers and co-organizers of the activity. The organization will have a policy for the approval of costs, and a supplier selection criteria approved by the governing body
		C	The organization shall prepare an annual budget for the following year, with corresponding explanatory report, and shall present the income and expenditure budgets of the previous year. The budget and the settlement will be approved by the governing body and shall be made public
		D	The organization will not have excessive resources in the past 2 years
		E	The organization will not submit an unbalanced financial structure over the last 3 years
		F	Investments must meet certain requirements of reasonable care
		G	In the event of having financial investments, the organization will have investment rules approved by the governing body
		H	Investments in unlisted companies are related, and will directly assist the attainment of social order
		I	The organization will respect the will of donors, and monitoring systems for targeted funds will be established. Funds from sponsorship will be considered as targeted funds
8	Presentation of financial statements and compliance with legal obligations	A	The organization certifies the fulfillment of legal obligations towards the Tax Administration, Social Security and Protectorate, or corresponding register
		B	The organization shall prepare annual accounts in accordance with the General Accounting Plan for Non-Profit Entities, which will be subject to an external audit and approved by the General Assembly or the Board
9	Promotion of volunteering	A	The organization will promote the participation of volunteers in their activities
		B	Those activities that are open to be engaged in by volunteers will be defined. The document in which such activities are designated will be public
		C	There will be a training plan consistent with designated activities available to volunteers
		D	Volunteers shall be insured in accordance with the risk posed by the activity performed

1. Source: Own elaboration from information provided by the Lealtad Foundation