Desur Regional Dissemination Meeting Province of Bologna

September 25th, 2013

Italy and Emilia-Romagna’s CSR framework

Italy socio-economic frame

National and international occurences

Economic, environmental, social and financial crisis

Globalization processes

Population’s growing old

Emigrants and immigrants flows

Italy socio-economic frame

Tourism

Machinery

Iron and Steel

Chemicals

Food processing

Textiles

Motor Vehicles

Clothing

Footwear

Ceramics

GDP 2012: industrial sector 26.7% agriculture 2% service industry 71.3%

Industrial sector is mostly concerned with:

Italy socio-economic frame

Smaller number of global corporations than other economies of comparable size

Productive processes are commonly fragmented and clustered in several industrial districts

The country was the world's 8th largest exporter in 2011

Italian economic fabric consists mainly of SMEs (99,7% of active

industrial enterprises has less than 250 employers)

SMEs employ more than 81% of actively working people, particularly in

the service industry (approximately 49%).

SMEs are quite often family-run

Among SMEs, 81,7% are micro enterprises

Italy CSR frameworkAcademic insight

The Italian Academy treated the subject as early as 1968 in an essay "Structures integrated into the Italian distribution system," in which the italian economist Giancarlo Pallavicini, stated that:

“Business activity, while aiming to profit, should take explicitly into account a number of internal and external instances, including socio-economic”

Italy CSR framework Forerunning Entrepreneurs and Managers

Adriano Olivetti (1901–1960) Italian engineer, politician and industrialist whose entrepreneurial activity thrived on

the idea thatprofit should be reinvested for the

benefits of the whole society

Enrico Mattei (1906 – 1962) was concerned with a

highly socially responsible public management

Italy CSR framework evolution

CSR ranges from philantropy

to Corporate citizenship

Italy CSR framework Laws and regulamentations

Art. 41 of Italian Constitution :

“Private economic initiative is free. There shall not be conflict with social utility or in a way that could damage safety, liberty, and human dignity. Law determines appropriate programms and controls so that public and private economy may be directed and coordinated towards social ends.”

Italy CSR frameworkLaws and regulamentations

Legislative Decree n.460 (12-4-1997) “Reorganisation of the tax regulations for non- commercial and non-profit organizations of social utility”

Law n.342 /11-21/2000) “Fiscal measures” Joint return Italy-UK (4-29-2003) on CSR Memorandum of understanding between Unioncamere and Ministry of Labour

and Social Welfare (11-27-2003) Memorandum of understanding between ANCL (national association labour

consultant) and Ministry of Labour and Social Welfare (11-27-2003) Memorandum of understanding between Assolombarda and Ministry of Labour

and Social Welfare (6-9-2004) Memorandum of understanding between Confapi and Ministry of Labour and

Social Welfare (6-9-2004) Memorandum of understanding between FederAmbiente and Ministry of Labour

and Social Welfare (3-23-2005) Regional legislation and rules (aknowledge of EU requests on CSR)

EU CSR policy Green Paper (July 2001)’Promoting a European framework for Corporate

Social Responsibility’

CSR is defined as “a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis”

Communication from the Commission concerning Corporate Social Responsibility, (July 2002)

‘Corporate Social Responsibility: ‘A business contribution to Sustainable Development’

Communication from the Commission concerning Corporate Social Responsibility, (March 2006)

‘Implementing the partnership for growth and jobs: making europe a pole of excellence on corporate social responsibility’

In October 2011 the European Commission published a new policy on CSR (A renewed EU strategy 2011-14 for CSR)

CSR is ‘The responsibility of enterprises for their impacts on society’

International CSR standard most implemented in Italy

SA 8000 Social Accountability International Sustainability Report Guidelines (GRI)AA1000 AccountAbility 1000ISO 26000ISO 14001EMAS Social AuditSocial labelISO 9000OHSAS 18001

Italy CSR framework Public initiatives

CSR – SC (Corporate Social Responsibility-Social Commitment) project (Ministry of Welfare 2002)

Based on voluntary CSR approach and the promotion of CSR across national socio-economic system

Third European Conference on CSR (Ministry of Welfare - Venice, 14 November 2003), Italian multi-stakeholder Forum for Corporate Social Responsibility

Initiative aimed to encourage the dissemination of CSR between businesses and Italian organizations

Italy CSR frameworkPrivate-Public initiatives

Q-RES project – Quality of the ethic-social responsibility

Supported and promoted by Centre for Ethics, Law and Economics - LIUC University of Castellanza (1999)

CSR award

Province of Modena and Chamber of commerce in partnership with Università of Modena and Reggio Emilia, Banca Etica, FocusLab

ORSADATA CSR Observatory

Sodalitas (in collaboration with ISVI and Impronta Etica)

Sodalitas Social Award

“Dal dire al fare” CSR exhibitionMilano Metropoli Development agency, BIC la Fucina, Koinetica

Social Value AwardMani Tese, Action Aid, Arci, AI Italia, Fondazione Banca Etica, Ucodep, Movimento Consumatori

Italy CSR frameworkPrivate-Public initiatives

Q-RES project – Quality of the ethic-social responsibility

Supported and promoted by Centre for Ethics, Law and Economics - LIUC University of Castellanza (1999)

CSR award

Province of Modena and Chamber of commerce in partnership with Università of Modena and Reggio Emilia, Banca Etica, FocusLab

ORSADATA CSR Observatory

Sodalitas (in collaboration with ISVI and Impronta Etica)

Sodalitas Social Award

“Dal dire al fare” CSR exhibitionMilano Metropoli Development agency, BIC la Fucina, Koinetica

Social Value AwardMani Tese, Action Aid, Arci, AI Italia, Fondazione Banca Etica, Ucodep, Movimento Consumatori

Italy CSR operators

Research and training centers (ISVI Istituto per i valori d’impresa, Centro Studi Enel, Officina Etica, Osservatorio FinEtica)

Academic research center: ALTIS, Alta Scuola Impresa e Società,CesCocom (Study Center on Consumption and Communication) EconomEtica (academic center for ethical economy and CSR

CSR awards (Sodalitas Social Award - Company’s Social Quality Awards Provincia di Parma, Sustainable innovation Awards Confindustria Giovani Reggio Emilia)

Consultant team (FocusLab, Bilanciarsi, Sinopsis Lab)

Non profit organizations (Impronta Etica – Fondazione Sodalitas – Club Modena CSR - GBS Study Group for Social report)

Public bodies (Chambers of commerce – UnionCamere – CISE - Ministry of Development – Ministry of Welfare)

Enterprises….

Managers……

International laws

National laws

International Standard

Regional laws

LegislationCSR playersFoundations

Unions

Public Administrations

Business associations

Enterprises

SMEs

Big corporations

Banks

Non profit organizations

International occurences

Rising environmental awareness

Globalization

Financial market trend

Human and workers rights

Consumers expectations

Companies scandals and breakdown

CSR playersEthical investors Research and training bodies

Rating companiesCertification authorities

National standard promoters

CSR awards organizers

Consultant team Auditing business

Italian CSR “engine”

Source: First report on CSR in Italy – by Prof. Mario Molteni – Università cattolica del Sacro Cuore - Milan

CSR bodies

Italy CSR culture

Increasing number of consumers aware of sustainability issues.

In particular 44% of consumers in 2013, compared to 38% in 2012, are willing to pay more for product/services made by companies that reinforced CSR programmes

In UE such percentage is on average around 36%

Survey by Nielsen Global survey on CSR carried out in may 2013 on a sample of 29.000 interviewed online in 58 countries

SMEs and CSR in Italy: what’s going on?

Companies socially involved: diminishing in number, raised invested funds

Why companies invest in CSR: ethical purposes and corporate image Funded initiatives: rising attention to the employers SMEs and CSR: for 67% of them CSR makes relationship with

employers stronger Ethical code: over 50% of the companies have adopted it Internal stakeholders: focus on workplace quality and safety External stakeholders (local community): sponsorships and charity Environmental committment: alternative energy sources

Source: SMEs CSR workshop 2010 – Faculty of Economics – University ‘Carlo Bo’ - Urbino

5° national report SWG for Socialis Observatory “Corporate Social engagement in Italy“ - 2012

CSR effectiveness measurement: it’s still little common

Internal communication: 27% of companies invest on it but don’t get employers involved

Most used medium for CSR activities: Internet

Dissemination of CSR principles among employers:

Intranet + Social report

SMEs weakeness factors: Scarce economic resources Instinctive management lack of incentives

SMEs and CSR in Italy: what’s going on?

Source: SMEs CSR workshop 2010 – Faculty of Economics – University ‘Carlo Bo’ - Urbino

5° national report SWG for Socialis Observatory “Corporate Social engagement in Italy“ - 2012

Emilia-Romagna socio-demographic features

Emilia-Romagna is one of the 20 italian regions and It’s located north-eastern It has nearly 4.5 million inhabitants (7% of the national

population), of which about 12% are foreigners The population in Emilia-Romagna region has been growing again, after the stagnation of the previous two decades, essentially due to foreign immigration

rising average age of the populationitalian lowest mortality rate region is characterized by an effective and efficient education system

Emilia-Romagna is the most important junction trading of the country

The port of Ravenna is the largest in the Adriatic Sea.

Significant increase in the car use (from 58.4%, regional average in 2001, to 67.2% in 2008, 7.4% of cycle-pedestrian modality, slight decline of 0.4% in the use of public transport in 2012)

Moderately fast growth in the use of web technologies (still remains a part of territory affected by a partial digital divide.)

E-R infrastructural system

Land consumption in the last thirty years have grown by 74% Urban sprawl and loss of urban systems efficiency Loss of competitiveness of urban systems due mainly to the flows of goods

and people handling, firms, workers and residents location The processes of production and energy conversion account for a

significant amount of polluting emissions. Energy efficiency improvement, however insufficient to meet the targets

set by the EU Growing development of recycling and waste recovery systems Industrial sector accounts for about 10% of water withdrawals

E-R settlement system and environmental quality

Emilia-Romagna socio-economic features

According to the Regional Innovation Scoreboard in 2009 Emilia- Romagna got an innovation performance score medium-high.Emilia-Romagna

Emilia-Romagna has one of the highest european GDP: 30.493 eur (ISTAT 2009) exceeding 27% of the EU average

In 2013 unemployment rate raised up to 9.4%, compared to 7.1% of 2012

Less than 30 aged unemployment rate 17.4% (2013)

Enterprises operating in the region are approximately 400.000, mostly SMEs (99,1% - less than 20 employers 97%)

Emilia-Romagna is a region where social capital is widespread, witnessed by a research carried out by sociologist R.Putnam, who defined it as "The

trust, rules which regulate coexistence, networks of civic associations, elements that improve the efficiency of social organization by promoting initiatives taken by mutual agreement“

Such level of social capital is confirmed by prof. R.Cartocci who analyzed it over the four-years period 1999-2002 in the 103 italian provinces by

means of 4 indicators

E-R social capital

Daily press circulation

Electoral participation level

Sport associations diffusion

Blood donors Social Capital Index

Maximum score

Trieste 225Bolzano 210Parma 208Genova 202Piacenza 201

Bologna 127Reggio E. 126Modena 125Ferrara 124Ravenna 121

Aosta 172Cuneo 169Pisa 164Livorno 162Pistoia 162

Ravenna 208Ragusa 191Siena 169Mantova 166Parma 165

Parma 151Mantova 144Piacenza 142Trieste 142Bologna 140

Productive system is mainly arranged in local production systems and (differently from national trend) networked industrial districts, based on the region-spread presence of small companies (mostly family-run) and cooperative system

Production pattern is characterized by a high quality manufacturing attitude and strong industrial vocation: Parma (Barilla and Parmalat), Reggio Emilia, Modena and Bologna (Ducati, Ferrari, Italjet, Moto Morini, Maserati, Lamborghini)

Industrial sectors widely ranged (chemicals in Ravenna, mechanic in central Emilia, textiles, electronics, ceramic districts in Modena surroundings, logistics in Piacenza)

Well developed, also, sea tourism and tourism in art cities, especially from abroad

E-R economic framework

Regional law n.21/2005 about Workplace conditions Norms for promotion and development of mutual cooperation in E-R (L.R.

6/2006) New Productive Activities Programme 2013-2015 meant to support CSRCSR resolution issued by Regional Committee on july 7° 2011

by which Region committes itself in leading a nation-wide innovative CSR policy through an ever more public-private partnershipMemorandum of Understanding between Region of E-R and Ministry of Economic Develpment to promote economic growth and SMEs sustainable competitiveness

E-R public initiatives to support CSR

Regional law n.21/2005 about Work conditions Norms for promotion and development of mutual cooperation in E-R (L.R. 6/2006) New Productive Activities Programme 2013-2015 meant to support CSRCSR resolution issued by Regional Committee on july 7° 2011Memorandum of Understanding between Region of Emilia-Romagna and Ministry of Economic Develpment on the matter of CSR training according to OECD guidelines Memorandum of Understanding between Region of Emilia-Romagna andMinistry of Economic Develpment to promote economic growth and sustainable competitiveness of SMEs

E-R public initiatives to support CSR

E-R public initiatives to support CSROngoing and planned initiatives fostered by Region of Emilia-Romagna are:Participation to CSR Transnational Interegional Project along with other

regions Planning of regional CSR workshop network by means of the involvement

of local CSR initiativesA thematic website concerned with CSROrganization of regional Forum on CSR issues plus periodic meeting aimed

at a comparison and assessement of CSR promotional initiatives

E-R CSR public-private initiatives

Public-private partnership to promote and support CSR

CSR Award Province of Modena (by Province of Modena and Chamber of Commerce)

CSR in the industrial districts - Surveys 2004, 2008 (by Focus Lab and Province of Modena)

Impronta Etica initiatives

Ugo Project (by Cise – Chamber of commerce)

According what emerged from Desur surveyKnowledge and the approach to CSR by SMEs is generally weak, mostly intuitive and unefficiently organizedDissemination can be considered still insufficientCSR is often meant as an additional cost and not as an opportunityInsufficient development of an entrepreneurial culture of CSRSMEs hardly understand the competitive surplus that might result from activation of a sustainability strategy. Frequently, SMEs in this area are included in an industry production chain where competitive criteria is represented by the priceCSR activities are often ‘unaware’ Insufficient attention paid to external stakeholdersTop management and/or the owner/entrepreneur play a key role in the implementation of CSR strategy

CSR culture regional framework

Main CSR focus among those internationally recognized, are: Work quality/Human resources Local project and connections Social accounting Environmental innovation Work safety

However, to be mentioned also several experiences in new CSR area of interest, such as:

supply chain involvement stakeholder engagement techniques work-life balance activities co-planning in collaboration with non-profit’s home-work sustainable mobility social entrepreneurship support

CSR culture regional framework

CSR culture regional framework It’s still widely understood that CSR is a philantropic activity

Among management tools, companies are being focused on Social Accounting SA8000 Standard Ethical Code Values Chart

International CSR standard reference are OECD guidelines UN Millenium Goals UN Global Compact GRI international guidelines

Source: Region of Emilia-Romagna Triennal productive activities programme 2012-2014 Report on CSR

Most implemented initiatives are focused on:Cultural awareness raising event (courses, seminars, conferences, etc.) Quantitative research (survey)Reward (awards, best practices observatory)

Most considered CSR issues regarding such initiatives:Work safety and qualityConciliation daily time and jobEnvironmentLocally relationships

CSR culture regional framework

Source: Region of Emilia-Romagna Triennal productive activities programme 2012-2014 Report on CSR

Thank you for your attention

Umberto Mezzacapo - CesCoCom Studies Center on Consumption and Communication

Department of Sociology and Business LawUniversity of Bologna

www.desur.eu